9911796707
TMI Blog2025 (2) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... grounds: - "The order of the PCIT-1 u/s. 263 of the Act is wrong as there wre regular business with M/s. AJS Impex Private Ltd. during the Assessment Year 2018-19 as under: Particulars Debit Rs. Credit Rs. Op. Balance 5,91,128 Purchases made in FY 2017-18 (AY 2018-19) 16,78,51416 Interest debited by party 10,38,251 Payments made F.Y. 2017-18 (A.Y. 2018- 19) 9,99,11,583 Balance 6,95,69,212 Total 16,94,80,495 16,94,80,495 Hence the AO correctly allowed the transaction as per supra, though he has highlighted on Page 11-12 of the order as under: Sr. No. Name Op. Balance Closing Balance 1 Turakhia International Pvt. Ltd. 8,46,02,450 2,79,01,886 DR. 2. Turakhi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manating from the record are: The assessee is engaged in the business of manufacturing of round/rectangular pipes from steel coils/sheets and is used for further manufacturing scaffolding and props. For the year under consideration, the assessee filed its return of income on 31.10.2018 declaring a loss of Rs. 7,36,71,524/-. On the basis of the information received from the Director General of GST Intelligence, the return filed by the assessee was selected for compulsory scrutiny and statutory notices under section 143(2) and 142(1) were issued and served on the assessee. During the assessment proceedings, the assessee filed the details in respect of sundry creditors. To examine the genuineness of the creditors, notices under section 133(6) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Co. 6. Subsequently, the learned PCIT vide notice dated 01.03.2024 issued under section 263 of the Act alleged that the AO added the credit amounts of two parties after concluding that the assessee has failed to discharge its onus to explain the genuineness of credits appearing in its books of account with regard to respective parties, however, in case of one more creditor, viz., AJS Impex Pvt. Ltd., although the AO held that the liability was not genuine no disallowance was made by the AO in the assessment order. Accordingly, the learned PCIT alleged that the assessment order passed under section 143(3) r.w.s. 144B of the Act is erroneous insofar as it is prejudicial to the interest of the Revenue. In response, the assessee submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Negotiable Instruments Act for cheque bouncing, which is contended to have bounced due to operation remaining closed by bank as per DRT order. It is submitted by the assessee that the proceedings are pending before the 56th Metropolitan Magistrate, 56th Court and the next date of hearing is on 12/04/2024. 4. The AO is directed to verify the ledger of M/s.AJS Impex Pvt Ltd in the books of the assessee. 5. The AO is directed to examine the issue of cessation of liability in all the other cases by bringing relevant documents on record as per the relevant provisions of the Act." 8. We have considered the submissions of both sides and perused the material available on record. In the present case, it is evident from the record that in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nst the debit balance noted on page 12 of the assessment order. Thus, it is ostensible that even despite coming to the conclusion that the genuineness of the transaction in respect of afore-noted 10 parties is not proved, the addition was only made in respect of two parties on the basis that liability has ceased to exist under section 41(1) without giving any reasoning as to why the same conclusion cannot be reached in respect of remaining 8 parties. Thus, we are of the considered view that the assessment order passed under section 143(3) r.w.s. 144B of the Act has been passed without making inquiries or verification which should have been made, and therefore, the present case clearly falls within the ambit of provisions of Explanation 2 to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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