TMI Blog2019 (5) TMI 1504X X X X Extracts X X X X X X X X Extracts X X X X ..... Sh. Praveen Jain / Nilesh Parmar without any incriminating material found in their possession or control at the time of search, which is the basis of addition. Therefore, in our considered opinion and in the interest of justice, the issues raised in the appeal are set aside to the file of the AO for fresh consideration, after giving adequate opportunity of being heard to the assessee. - ITA No. 5498/DEL/2017, ITA No. 5712/DEL/2017 - - - Dated:- 23-5-2019 - Shri H.S. Sidhu, Judicial Member And Shri Prashant Maharishi, Accountant Member For the Assessee : Sh. Anil Kumar Sujanti, CA For the Department : Smt. Naina Soin Kapil, Sr. DR. ORDER PER H.S. SIDHU, JM These are the cross appeals filed by the Assessee and the Revenue emanate out of the Order of the Ld. Commissioner of Income Tax (Appeals)-18, New Delhi dated 27.6.2017 pertaining to assessment year 2007-08. Since the issues involved in these appeals are common and identical, hence, the appeals were heard together and are being consolidated by this common order for the sake of convenience, by first dealing with Assessee s Appeal No. 54 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eeping in view lower G.P. Rate during the year for determining the quantum of addition without looking to higher G.P. rate of 27.05% already declared in Form 3CD during the year by the assessee. 9. The Ld. CIT(A) has erred on facts and in law in confirming an arbitrarily addition of ₹ 16,90,250/-(25% of 67,61,000/-) by assuming that the assessee has got the diamond from grey market while procuring bills from accommodation entry provider. 10. The Ld. CIT(A) has erred in facts and in law in upholding the additional arbitrary addition on assumption and presumption basis of ₹ 13,522/- (0.2% of 67,61,000/-) u/s. 69C on account of alleged commission payment in trade to obtain bogus bills in cash from unaccounted sources not accounted for in cash book. Prayer 1. The appellant / assessee craves to amend, alter and modify any of the grounds of appeal. 2. The appropriate cost be awarded to the appellant/ assessee. 3. The appellant / assessee may be allowed such additional relief as may be deemed fit and proper in case at the time of hearing of the appeal with facts and circumstances of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vide letter dated 15.12.2014. The assessee filed a supplementary rejoinder dated 29.12.2014 to the objections raised earlier and the same were removed by another order dated 01.01.2015. In response to the notices, the AR of the Assessee attended the hearing from time to time and submitted the relevant details / submissions. After considering the same, the AO observed that assessee was issued show caused vide order sheet entry dated 13.1.2015 as to why the purchases of ₹ 67,61,000/- from M/s Mohit International should not be considered as bogus purchase expense and be disallowed considering submission of Sh. Praveen Kumar Jain and Sh. Nilesh Parmar, Proprietor, M/s Mohit International which is mere an accommodation entry. In response to the same, the assessee filed its reply which was considered by the AO and was not found tenable. AO observed that the assessee being beneficiary of bogus accommodation entries would definitely record inventories in stock register as well as would make payments through account payee cheques so as to book bogus purchase expenses. Moreover, the statement of Sh. Parveen Kumar Jain and Sh. Mr. Nilesh Parmar (Proprietor, M/s Mohit International) was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. CIT (A) has not adjudicated the ground of appeal No. 6 particularly agitating for not providing collected material, if any statements retracted in spite of written request for rebuttal. It was further submitted that Ld. CIT(A) has ignored the chain of original documents for import of diamonds by Sh. Praveen Jain/Nilesh Parmar group available with tax authorities in collected seized material at the time of search as per the disclosure of said facts by Nilesh Parmar in his affidavit for retraction of the statement made u/s 132(4) of the Act being clinching evidence of procurement of diamonds from importers for making the genuine supplies from the same by M/s Mohit International to the assessee. It was further submitted that Ld. CIT(A) has erred in confirming an above addition by treating conclusive general admission description in the relevant extract of the statements u/s 132(4) of the Act of Praveen Kumar Jain prop, of M/s Mohit International provided to the assessee which was recorded on the back of the assessee without providing an opportunity of confronting cross-examination of the concerned persons to the assessee. It was further submitted that Ld. CIT(A) has n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... parties and perused the records especially the impugned order passed by the Ld. CIT(A). We find considerable cogency in the contention of the Ld. counsel for the assessee that that Ld. CIT (A) has not adjudicated the ground of appeal No. 6 particularly agitating for not providing collected material, if any statements retracted in spite of written request for rebuttal. It was also noted that Ld. CIT(A) has ignored the chain of original documents for import of diamonds by Sh. Praveen Jain/Nilesh Parmar group available with tax authorities in collected seized material at the time of search as per the disclosure of said facts by Nilesh Parmar in his affidavit for retraction of the statement made u/s 132(4) of the Act being clinching evidence of procurement of diamonds from importers for making the genuine supplies from the same by M/s Mohit International to the assessee. It is also noted that Ld. CIT(A) has wrongly the addition by treating conclusive general admission description in the relevant extract of the statements u/s 132(4) of the Act of Praveen Kumar Jain prop, of M/s Mohit International provided to the assessee which was recorded on the back of the assessee without ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r which purpose it wanted to avail the opportunity of crossexamination. That apart, the Adjudicating Authority simply relied upon the price list as maintained at the depot to determine the price for the purpose of levy of excise duty. Whether the goods were, in fact, sold to the said dealers/witnesses at the price which is mentioned in the price list itself could be the subject matter of cross-examination. Therefore, it was not for the Adjudicating Authority to presuppose as to what could be the subject matter of the cross-examination and make the remarks as mentioned above. We may also point out that on an earlier occasion when the matter came before this Court in Civil Appeal No. 2216 of 2000, order dated 17.03.2005 was passed remitting the case back to the Tribunal with the directions to decide the appeal on merits giving its reasons for accepting or rejecting the submissions. In view the above, we are of the opinion that if the testimony of these two witnesses is discredited, there was no material with the Department on the basis of which it could justify its action, as the statement of the aforesaid two witnesses was the only basis of issuing the Show Cause. W ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
