TMI Blog2019 (3) TMI 1958X X X X Extracts X X X X X X X X Extracts X X X X ..... uch opportunity have been allowed. Assessing Officer in the instant case has stated that Mr. Rajendra Jain, Mr. Dharmichand Jain and Mr. Anoop Jain have appeared before him. However, it is not made clear as to whether the above said three persons were partners/directors, all the suppliers belonging to Rajendra Jain. The purchases made from companies, where these three persons are either partner/director, shall be aware by the above said decision rendered by Coordinate Bench. The purchases made from other companies, however requires fresh examination. The aforesaid decisions rendered would apply mutatis mutandis to the case before us. Accordingly, we restore the issue relating to addition on account of bogus purchases made during the year under consideration to the file of the Ld. AO with a direction to delete the addition relating to purchases made from companies, in which above said three persons are partners / Directors. Appeals of the assessee as well as the revenue are allowed for statistical purposes - ITA No. 4190/Mum/2017 And ITA No. 6138/Mum/2017 - - - Dated:- 8-3-2019 - Shri Mahavir Singh, JM And Shri M.Balaganesh, AM For the Assessee : Shri R. Murlidhar. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us Firm PAN Bogus Firm of Name AY Beneficiary PAN Amount ABIPJ5587A AVI EXPORTS 2008-09 AAFCS8914F 88,87,359/- ABAFS0852K SUNDIAM 2008-09 AAFCS8914F 3,43,93,905/- ABAFS0852K MANIPRABHA IMPEK 2008-09 AAFCS8914F 5,74,04,993 AOVPK0047C VITRAG 2008-09 AAFCS8914F 29,63,800/- TOTAL 10,36,49,557/- 3.2. All the details of purchases made from the aforesaid parties together with the relevant documents were furnished by the assessee. But the same were not appreciated by the Ld. AO on the ground that the assessee had indeed made bogus purchases from the aforesaid parties. Accordingly, the Ld. AO proceeded to make an addition towards bogus purchases @12.5% of purchases of ₹ 10,36,49,557/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re, we would like to refer to order of the Tribunal in the case of Romila M. Nagpal (supra),wherein in the similar circumstances, addition confirmed by the FAA were deleted. In that order, the tribunal had referred to the case of M/s. Imperial Imp Exp.(ITA No.5427/Mum/2015 A.Y.2009-10). In Imperial Imp Exp. matter, the assessee was exporting goods. The relevant portion of the order of reads as under: 2. Effective Ground of appeal is about addition made to her income with regard to purchases. The AO received an information from the investigation wing that the sales tax department, Govt. of Maharashtra had made enquiries about bogus purchases/hawala transactions. The sales tax authorities had forwarded the list of beneficiaries who had taken bills from the hawala dealers. The AO observed that assessee had purchased goods worth ₹ 1.35crores from three parties namely Shri Ganesh Trading (₹ 27.73 lakhs); Kishna Chemical Works (₹ 27.85 lakhs) and Shreyas Marketing Agency (₹ 80.40 lakhs). The AO issued a notice u/s.148 of the Act .In response to the notice the assessee stated that return filed on 24/9/2009 should be treated as return filed in response to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions of section 147, that he was justified in making the disallowance of ₹ 16.99 lakhs. Finally, he dismissed the appeal filed by the assessee. 4. During the course of hearing before us the Authorised Representative (AR) submitted that the assessee had filed all necessary details before the AO, that stock register and quantitative details were made available to the AO, that payments were made through banking channels. He referred to the cases of Shri Mahesh Shah (ITA No.5194/Mum/2014 A.Y.2010-11); M/s. Imperial Imp Exp. (ITA No.5427/Mum/2015 A.Y.2009-10); Shri Ramila Pravin Shah (ITA No.5246/M/2013 A.Y.10-11); Shri Deepak Popatlal Gala (ITA No.5920/Mum/2013 A.Y.2010-11,dated 27/3/2015); Ramesh Kumar and Co.(ITA No.2959/Mum/2014 A.Y.2010-11 dated 28/11/2014); Shri Rajeev G. Kalathil (ITA No. 6727/Mum/2012 A.Y.2009-10 dated 20/08/2014);Shri Ganpatraj A. Sanghavi (ITA No.2826/ Mum/ 2013 A.Y. 2009-10 dt.5/11/2 014 and Shri Hiralal Chunilal Jain (ITA No.4547/Mum/2014 dated 01/01/2016. The DR supported the order of the FAA. 5. We have heard the rival submissions and perused the material before us. We find that in the case of Imperial Imp. Exp.(supra) identical issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer as well as before the CIT(Appeals) was that the purchases in question were duly supported by the bills of purchase. Moreover, the assessee pointed out that all its sales were by way of exports and that there was no evidence to say that the purchases in question were bogus. The assessee also referred to his bank statement to prove payments to such parties. The details of goods sold by the assessee was also furnished, which corresponded to the purchases effected from such four parties. The CIT(Appeals) has primarily affirmed the stand of the Assessing Officer based on the information stated to have been received from the Investigation Wing of the Department relating to the finding of the Maharashtra VAT Department. Additionally, the CIT(Appeals) also noticed that assessee could not prove the existence of the suppliers and, therefore, the circumstantial evidence also suggested that the entire purchases from the four parties was unverifiable. However, he restricted the addition to 5.41% of the amount of such unexplained purchases, instead of 12.5% adopted by the Assessing Officer. The CIT(Appeals) has applied the rate of 5.41% being the gross profit rate of the assessee for the ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Assessing Officer ought to have brought on record material which is relevant to the transactions of the assessee with the aforesaid four parties instead of making a general observation about the information received from the Sales Tax Department of the Government of Maharashtra. Quite clearly, the Assessing Officer as well as CIT(Appeals) have taken note of the fact that no sales could have been effected by the assessee without purchases. In the present case, assessee has explained that all its sales are by way of exports. The books of account maintained by the assessee show payment for effecting such purchases by account payee cheques and also the vouchers for sale and purchase of goods, etc. Notably, no independent enquiries have been conducted by the Assessing Officer. Under identical circumstances, our Co-ordinate Benches in the cases of Deepak Popatwala Gal (supra), Shri Rajeev G. Kalathil(supra)and Ramesh Kumar and Co.(supra) have held that the Assessing Officer was not justified in making additions merely on the basis of information obtained from the Sales Tax Department of the Government of Maharashtra without conducting any independent enquiries. Before the CIT(Appea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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