9911796707
TMI Blog2024 (6) TMI 426X X X X Extracts X X X X X X X X Extracts X X X X ..... es in question are in the nature of accommodation entry." 3. The issue arising ground no. 1, raised by Revenue, pertains to deletion of addition made u/s 69A of the Act on account of sales of M/s. Gulathi Enterprises. 4. The brief facts of the case pertaining to this issue, as emanating from the records, are: The assessee is an individual and is carrying on the business of trading in scrap, pipes, hot/cold rolled steel coils, steel plates and related products through his proprietary concern, i.e. GSP International. For the year under consideration, the assessee filed its return of income on 02/03/2022 declaring a total income of Rs. 18,17,080/-. The return filed by the assessee was selected for complete scrutiny through CASS and statutory notices u/s 143(2) as well as section 142(1) of the Act were issued and served upon the assessee. During the assessment proceedings, it was observed that an amount of Rs. 3,95,15,327/- has been shown as sales in the GST return of the assessee. Accordingly, the assessee was asked to show cause as to why the sales of Rs. 3.95 crore should not be treated as part of the assessee's sales. In response thereto, the assessee submitted that M/s. Gulathi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, since the sales of the assessee as per the GST return was higher than in the sales as per the Profit and Loss Account of the assessee, the AO asked the assessee to reconcile the two items. As per the return, out of total turnover of Rs. 26.89 crore as per GST return, turnover of M/s. Gulathi Enterprises was Rs. 3.95 crore and after the excluding such turnover pertaining to M/s. Gulathi Enterprises, the balance turnover tallies with the Profit and Loss Account. It has been the submission of the assessee that the M/s. Gulathi Enterprises had fraudulently applied GST number under PAN of the assessee, and accordingly, the turnover of M/s. Gulathi Enterprises is getting reflecting in its GST return. It is evident from the record that in this regard the assessee had filed complaint with Police Department as well as the Department of GST. It is further evident from the record that the GST Department has even cancelled the GST number of M/s. Gulathi Enterprises. However, since the AO did not receive any response from the Department of GST to its letter seeking information in respect of transaction done through GST number issued in the name of M/s. Gulathi Enterprises, the AO proceeded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was found M/s. Viraj Profile Ltd has claimed purchases in the names of various parties, which are not genuine purchase and accommodation entities, the assessee was asked to show cause as to why the purchases claimed of Rs. 4,55,36,000/- from M/s. Ankit International, proprietary concern of Shri Pranav Jain, in the year under consideration should not be disallowed and added to the total income of the assessee. In response thereto, the assessee submitted that during the search action in the case of M/s. Viraj Profile Ltd on 13/07/2017, M/s. Ankit International from whom M/s. Viraj Profile Ltd had been alleged to have made bogus purchases was also covered under the survey action u/s 133A of the Act. However, the search took place on 13/07/2017 and the assessee has made purchases from M/s. Ankit International during in the financial year 2020-21, which is around 3 - 4 years, after the date of search, and therefore, the findings of the search are not at all relevant to the purchases made from M/s. Ankit International. The assessee further submitted that he is a trader in steel and whatever purchases were made from M/s. Ankit International have been sold to various parties, and the uns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. For reaching the aforesaid conclusion, the learned CIT(A) also considered the reply of Shri Pranav Jain to the notice issued u/s 133(6) of the Act and the reply to the summons issued u/s 131 of the Act. Being aggrieved, the Revenue is in appeal before us. 10. We have considered the submissions of both sides and perused the material available on record. From the record, it is evident that search u/s 132 of the Act was carried out on 13/07/2017 in the case of M/s. Viraj Profile Ltd, wherein it was found that the M/s. Viraj Profile Ltd had claimed purchases in the names of various parties which are not genuine purchases and were accommodation entries. Further, survey action u/s 133A of the Act was carried out simultaneously on the assessee's proprietor firm M/s. GSP International, M/s. Ankit International and M/s. SPA Heights Pvt. Ltd. During the aforesaid search and survey action, the statement of directors/proprietors of these entities were recorded, wherein some of them stated that their entities were engaged in providing accommodation entries on account of providing bogus sales details to Viraj Group on commission basis. Further, the Sr. employees of Viraj Group had accepte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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