TaxTMI 
TaxTMI 
2021 (3) TMI 401
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....nd in the circumstances of the case and in law, ld.CIT(A) has erred in deleting the addition u/s. 69C by holding that opportunity of cross-examination is not provided to the assessee ignoring the fact that at para 4.2 of the assessment order the AO has categorically mentioned that further to the non service of notice issued u/s. 133(6) by postal authority, the assessee was also asked to produce parties for verification which the assessee did not comply with and therefore, Ld.CJT(A) failed to appreciate that the onus to prove genuineness is not discharged by assessee. 2.1 On the facts and in the circumstances of the case and in law, Id. CIT(A) has erred in deleting the addition u/s. 68 of the Act in violation of Rule 46A of the I.T.Rules, by not remanding to the AO to afford opportunity of cross-examination to the assessee. 2.2 On the facts and in the circumstances of the case and in law, Id.CJT(A) has erred in deleting the addition u/s. 68 of the Act disregarding the Hon'ble Delhi High Court decision in the case of CIT V/s Jansampark Advertising & Marketing (P) Ltd, 375 JTR 373 (Delhi) wherein Hon'ble Court while remanding the matter held that two appellate authorities ....
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....ved by certain relief provided to the assessee by Ld. CIT(A) on account of alleged bogus purchase as well as deletion of addition u/s 68. 2. We have carefully heard the rival submissions and perused relevant material on record including written submissions and documents placed in the paper book. The judicial precedents as relied upon during the course of hearing have duly been deliberated upon. Our adjudication to the subject matter would be as given in succeeding paragraphs. 3.1 Facts on record would reveal that the assessee being resident corporate assessee stated to be engaged as technology solution provider was assessed for the year under consideration u/s. 143(3) r.w.s. 147 on 29/03/2016, wherein it was saddled with following additions which are the subject matter of appeal before us: - 1. Bogus purchases : Rs. 470 Lacs 2. Unexplained cash credit u/s.68 : Rs. 261.53 Lacs 3. Interest on unsecured loans : Rs. 0.69 Lacs 4. Disallowance u/s. 36(1)(va) : Rs. 1.16 Lacs 3.2 The original return of income filed by the assessee was processed u/s. 143(1). Pursuant to receipt of certain information from DGIT (investigation), it was alleged that assessee procured bogus p....
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....sh the genuineness of the transactions. The sales were not disturbed or doubted. Therefore, non-service of notice could not be the sole basis to make additions. However, on the facts of the case, the assessee may have made purchases from grey market but it procured bogus bills and therefore the profit element embedded in these transactions was to be estimated. The estimation was made @5% of these purchases which reduced the impugned addition to Rs. 12.61 Lacs. Aggrieved, the revenue is in further appeal before us. However, the assessee has not pressed this ground before us and accepted the verdict of Ld. CIT(A). 5. Upon careful consideration of factual matrix as enumerated in preceding paragraphs, it is evident that the assessee was in possession of purchase invoices and it placed on record confirmation of accounts. The payments to the suppliers were through banking channels. The assessee produced stock register extract and correlated the tainted purchases with sales transactions. There could be no sale without actual purchase of material keeping in view the assessee's nature of business. The sales have not been disputed or disturbed by the revenue. In such a case, the approach....
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....ow cause notice specifically requiring the appellant to establish the identity, source and creditworthiness. Remand report has been called for and the rejoinder of the assessee is also taken on record. 4.4 The appellant contended that the loans were taken for meeting the working capital requirements of its Ahmedabad Janmarg Limited of Ahmedabad Municipal Corporation popularly known as BRTS. The appellant vide additional evidence furnished the copy of PAN along with the signed copy of the loan confirmation; of the all the lenders. Further, the appellant has produced copy of bank statements reflecting the said loan amounts and Income Tax return of all the lenders except Mr. Ramji Shah and Mrs. Ratanbai Ramji Shah and Mr. Ranjit Kamat. It is further observed that both the lenders i.e. Mr. Ramji Shah and Mrs. Ratanbai Ramji Shah expired on 04.06.2010 & 17.07.2014 respectively. This fact is confirmed by their legal heir (son) Mr, Ajit Shah in his signed loan confirmation submitted by the appellant. Hence the appellant could not produce the bank statement and the copy of ITR for late Mr. Ramji Shah and late Mrs. Ratanbai Ramji Shah. Further, it is observed that the loan from Mr. & Mrs.....
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....iwal (2014) 366 ITR 217 (Raj.)(HC). 3. Orient Trading Co. Ltd. vs. CIT (1963) 49 ITR 723 (Bom)(HQ 4. CIT vs. Chandela Trading Co. P. Ltd. (2015) 372 ITR 232 (Cal.)(HC) 5. ACIT v. Sanjay M. Jhaveri (2015) 168 TTJ 751(Mum.)(Trib.) 4.7 Considering the evidence brought on record by the appellant company regarding the loans taken during the year, the explanations furnished and after considering the case laws on the issue, the addition made by the AO is found to be unwarranted. Therefore, the addition of Rs. 2,61,53,918 made u/s 68 of the Act is hereby deleted. Appellant gets relief. Ground number 1 to 4 and 10 are allowed. Consequently, the interest paid against these loans was also allowed. Aggrieved, the revenue is in further appeal before us. 7. From the aforesaid factual findings rendered by learned first appellate authority, the undisputed position that emerges is that Ld. AO, without calling for requisite information from the assessee, chose to make impugned additions during assessment proceedings. During appellate proceedings, the assessee submitted documentary evidences to demonstrate the fulfilment of primary ingredients of Sec.68. The confirmations of the lender....