2017 (12) TMI 1667
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....nito: 2.1 The Ld. CIT(A) erred in upholding the reassessment order passed by the Assessing Officer which is bad in law and void ab initio as it is based on conjectures and surmises without there being concrete reason that the income has escaped the assessment. 3. Disallowance of 12.5% of certain purchases alleged to be bogus in nature. 3.1 The Ld. CIT(A) grossly erred in making a disallowance of 12.5% made by the AO in respect of purchases alleged to be bogus in nature based on the information received the Sales Tax Department, without considering the strong evidence and details submissions given by the appellant. 3.2 The Ld. CIT(A) partly upheld the disallowance made by the Assessing Officer without appreciating that the non-payment of VAT by the seller should nor form the basis of disallowance of genuine purchases. 3.3 The Ld. CIT(A) grossly erred in disallowing 12.5% of the alleged purchases which is arbitrary and has no basis, even when the evidence s and records submitted by the appellant as well as the corresponding sales to the alleged purchases were not disputed and were duly accepted by both the Assessing Officer and the Ld. CIT(A). 3.4 Without prejudice to the....
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....information was received from DGIT(Inv.), Mumbai which was forwarded by virtue of letter no. CIT-21/H.Qrs/Sales Tax Infor/2012-13 26.02.2013 in which it was conveyed that the assessee has taken the accommodation entries from various parties without any actual dealing, the assessee received the accommodation entries from the following 20 parties.:- S no. Name of the bill provider Tin No. Amount 1 Dhruv Sales Corporation 27760622173V 14,07,177 2 Sachi Mercantile P. Ltd. 27770610285V 19,23,724 3 J B Interlink 27800298365V 24,70,753 4 P.K. Trading company 27830258239V 26,74,095 5 K.K. Trading Company 27960673085V 7,03,162 6 Vitarag Trading Company 27830385697V 23,74,939 7 Bhumi Enterprise 27860587392V 9,77,485 8 Prayan Trading Company 27740535951V 25,91,461 9 Surachi Multitrade P. Ltd. 27200610259V 15,03,623 10 Hariom Traders 27840642014V 11,47,141 11 Sampark Steels 27170360840V 23,23,571 12 N B Enterprises 27490339033V 24,81579 13 Bhagwati Trading Company 27020614820V 21,66,542 14 Revika Trade Impex P. Ltd. 27730562486V 34,06,054 15 Sivamani Traders P. Ltd. 27290589500V 11,81,472 16 Newspark trading co. p. ltd. 2753039....
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....of the assessee. The assessee filed an appeal before the CIT(A) who restricted the claim of the assessee to the extent of 12.5% of the bogus purchase. The assessee was not satisfied, therefore, filed the present appeal before us. However, the revenue has also filed an appeal in which the contention of the revenue is that whole addition of bogus purchase is liable to be added to the income of the assessee. ISSUE NO.1:- 7. Issue no. 1 is generally in nature which nowhere required any adjudication. ISSUE NO.2:- 8. At the time of argument the assessee did not press this issue, therefore, this issue is being decided in favour of the revenue against the assessee. ISSUE NO.3:- 9. Under this issue the assessee has challenged the addition confirmed by CIT(A) @ 12.5% of the bogus purchase. The Ld. Representative of the assessee has argued that the Assessing Officer has raised the addition on the basis of the information received by the DGIT(Inv.), Mumbai in connection with the purchase from 20 parties total to the tune of Rs. 4,14,91,279/- but the evidence adduced by assessee has not been considered by the AO as well as CIT(A), therefore, the order passed by the CIT(A) is wrong against ....
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....w party-wise. 1. Dhruv Sales Corporation:- The assessee given the ledger A/c. which lies at page no. 157 of the paper book. The assessee has also submitted the confirmation of account by the supplier which lies at page no. 158 of the paper book. The assessee has also submitted the MVAT Challan which lies at page no. 159 of the paper book. The assessee has also furnished the invoices of purchase and sales along with delivery challans which lies at page no. 160-165 of the paper book. 2. Sachi Merchantile P. Ltd.:- The assessee given the ledger A/c. which lies at page no. 340 of the paper book. The assessee has also submitted the confirmation of account by the supplier which lies at page no. 341 of the paper book. The assessee has also submitted the MVAT challan which lies at page no. 342-344 of the paper book. The assessee has also submitted the Purchase and Sales invoices along with delivery challans which lies at page no. 345-359 of the paper book. 3. J. B. Intrlink.:- The assessee has given the ledger A/c. which lies at page no. 323 of the paper book. The assessee has also submitted the confirmation of account by the supplier which lies at page no. 324 of the paper book. The....
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....pplier which lies at page no. 450 of the paper book. The assessee has also submitted the MVAT challan which lies at page no. 451 of the paper book. The assessee has also submitted the Purchase and Sales invoices along with delivery challans which lies at page no. 452-462 of the paper book. 10. Hari Om Traders. :-The assessee has given the ledger A/c. which lies at page no. 268 of the paper book. The assessee has also submitted the confirmation of account by the supplier which lies at page no. 269 of the paper book. The assessee has also submitted the acknowledgements of VAT return which lies at page no. 270 of the paper book. The assessee has also submitted the Purchase and Sales invoices along with delivery challans which lies at page no. 271-282 of the paper book. 11. Sampark Steel. :-The assessee has given the ledger A/c. which lies at page no. 463 of the paper book. The assessee has also submitted the confirmation of account by the supplier which lies at page no. 464 of the paper book. The assessee has also submitted the Purchase and Sales invoices along with delivery challans which lies at page no465-480 of the paper book. 12. N. B. Enterprises.:- The assessee has given ....
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....submitted the confirmation of account by the supplier which lies at page no. 414 of the paper book. The assessee has also submitted the MVAT challan which lies at page no. 415 of the paper book. The assessee has also submitted the Purchase and Sales invoices along with delivery challans which lies at page no. 416-427 of the paper book. 18. Omkar Trading Co.:- The assessee has given the ledger A/c. which lies at page no. 395 of the paper book. The assessee has also submitted the confirmation of account by the supplier which lies at page no. 396 of the paper book. The assessee has also submitted the MVAT challan which lies at page no. 397 of the paper book. The assessee has also submitted the Purchase and Sales invoices along with delivery challans which lies at page no. 398-412 of the paper book. 19. Jindal Steel Corporation.:- The assessee has given the ledger A/c. which lies at page no. 187 of the paper book. The assessee has also submitted the confirmation of account by the supplier which lies at page no. 188 of the paper book. The assessee has also submitted the MVAT challan which lies at page no. 189 of the paper book. The assessee has also submitted the Purchase and Sales ....
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....purchase is liable to be considered to the income of the assessee in view of the law settled in Vijay Protein Vs. CIT 58 ITT 458 (Ahd) and CIT Vs. Simit P Sheth 356 ITR 451 (Gujrat High Court). In the present case sale has not been disputed and the books of account have not been rejected In the instant case, when the assessee has adduced the sufficient evidence on record which has been discussed about therefore, in the said circumstances, we are of the view that the no addition is required to be made on account of bogus purchase. Non service of noticed is not a ground to raise the addition of bogus purchase to the income of the assessee in view of the law settled in CIT Vs. M/s. Nikunj Eximp Enterprises P. Ltd. 2016 taxman.com 171 (Bombay High Court). On seeing the above facts and circumstances of the present case and in view of the law settled relied by the Ld. Representative of the assessee we are of the view that the no addition is required to be raised in the instant case. We ordered accordingly, we decide this issue in favour of the assessee against the revenue. Accordingly, the claim of the revenue is hereby ordered to be dismissed. ISSUE NO.4:- 11. Under this issue the ass....
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....ection raised by the Appellant and the said order was not even a speaking order as per the principles laid down by the Supreme Court in the case of GKN Driveshafts (India) Limited. Disallowance of 6^ amounting to Rs. 15,60,270/- in respect of certain purchases alleged to be bogus in nature. 3.1 The Ld. CIT(A) grossly erred in making a disallowance of 6^ in respect of purchases amounting to Rs. 15,60,270/- alleged to be bogus in nature based on the information received from the Sales Tax Department, without considering the strong evidence and details submissions given by the appellant. 3.2 The Ld. CIT(A) partly upheld the disallowance made by the Assessing Officer without appreciating that the non-payment of VAT by the seller should nor form the basis of disallowance of genuine purchases. 3.3 The Ld. CIT(A) grossly erred in disallowing 6^ of the alleged purchases which is arbitrary and has no basis, even when the evidence s and records submitted by the appellant as well as the corresponding sales to the alleged purchases were not disputed and were duly accepted by both the Assessing Officer and the Ld. CIT(A). 3.4 The Ld. CIT(A) grossly erred in upholding part disallowance....
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....add a new ground which may be necessary." 15. The facts of the present case are the same as mentioned above in the appeal no 277/M/2017, therefore, there is no need to repeat the same. However, the figure is different. In the instant case, the assessee has raised the objection of validity of issuance of notice u/s 148 of the I.T. Act as well as also raised the question of merits. ISSUE NO.1:- 16. Issue no. 1 is generally in nature which nowhere required any adjudication. ISSUE NO.2:- 17. Under this issue the assessee has challenged the validity of the notice issued u/s 148 of the I.T. Act. The Ld. Representative of the assessee has argued that the Assessing Officer received the information from Sales Tax Department vide letter dated 26.02.2013 and notice u/s 148 of the Act was issued and served upon the assessee on 15.02.2013 which clearly speaks that there was no reasons at the time of issuance of the notice u/s 148 of the Act to invoke the proceeding, therefore, the condition u/s 148 of the Act was not satisfied, hence, the notice u/s 147/148 of the Act is wrong against law and facts and is liable to be set aside in view of the law settled in GKN Driveshafts (India) Ltd. Vs.....