TaxTMI 
TaxTMI 
2006 (12) TMI 184
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....sessed under s. 143(1)(a) on 30th Nov., 1999. Subsequently, the AO received information from the Sales-tax Department that the assessee firm has shown purchases from such concerns, which either did not exit or did not make any sales during the relevant period. On the basis of this information, the AO recorded reasons for reopening and issued notice under s. 148/147 of the Act. The reasons were recorded by the AO that the assessee made bogus purchases worth Rs. 6,58,652 and the same were not recorded in his books of accounts. Therefore, the AO found that the income chargeable to tax had escaped assessment. On the basis of this reason recorded by the AO, the assessee was show caused. After hearing the assessee the assessment under s. 143(3) r....
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.... of self cheque, on the reverse side of which it was mentioned that "Rs. 2,20,000 deposited in CA 156 contra entry 100 x 30". Account No. 156 belongs to the assessee. From this, the AO concluded that a sum of Rs. 2.2. lakhs was directly credited in current account No. 156 whereas balance sum of Rs. 3,000 was withdrawn in cash by M/s Lal Chand Rai Harish Kumar. The AO recorded the statement of the asstt. manager of the bank under s. 131 on 19th Jan., 2004 and made verification in respect of entry on the reverse side of the self cheque. The asstt. manager stated that a sum of Rs. 2.20 lakhs was deposited in the current account No. 156 and the balance amount was given in cash. According to the manager, the reverse entry in the banking accounti....
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....from farmers or other parties and in the process saved 2 per cent sales-tax, 2 per cent Mandi tax and 1.6 per cent 'Arhat' expenses. Consequently, he further made an addition of Rs. 17,050 being extra profits @ 5.6 per cent on the purchases. 3. The learned CIT(A), however, deleted the addition made on account of purchases from M/s Om Prakash Ashish Kumar, but upheld the addition made on account of purchase of Narma from M/s Lal Chand Rai Harish Kumar. 4. The assessee has challenged the sustained addition of Rs. 2,20,000 as mentioned above. I have heard the rival submissions and perused the evidence available on record. 5. The main thrust of Shri N.R Mertia is that the assessee made payment against the impugned purchases through che....
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....0 issued in self name by M/s Lal Chand Rai Harish Kumar was paid by the bank. 6. On the other hand, the learned Departmental Representative has placed heavy reliance on the orders of the authorities below. 7. Having gone through the rival submissions, in the light of the available evidence on record, it is a crystal clear finding of facts that there is no proof on record that the amount of Rs. 2,20,000 was deposited in the account of M/s Jagdamba Trading Company a/c. This was amply verified by the Department and the AO could not make a clear-cut finding in this regard. It is also evidently clear from the available evidence that the impugned addition of Rs. 2,20,000 was made only on account of the contra entry narration made on the bac....
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.... opportunity of cross-examination was not given to the assessee, it is hardly justified to heavily rely on the same. It is strange that more often than not the Revenue rejects such affidavits filed by the assessees in support of their claim but in this case because it suits their version, the AO is blindly accepting the contents of these affidavits. These affidavits were filed during sales-tax proceedings of the seller, which do not have any concern with the income-tax proceeding of this assessee. In that view of the matter, these affidavits have hardly any evidentiary value against the present assessee. I agree with the learned Authorised Representative that when Revenue has not disputed the purchase in question and it has only disputed th....
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.... vs. Paramanand, Prop. M/s Jal Karan Das Paramanand, in ITA No. 275/Jd/2005 (asst. yr. 1999-2000) in which also the same seller, namely, M/s Rajender Prasad (sic) is involved. As a result, the impugned addition stands deleted. 8. The other effective issue of this appeal is in relation to disallowances of Rs. 5,000 and Rs. 2,500 out of shop expenses and telephone expenses. 9. This was not really pressed before me at the time of arguments. Consequently, this issue is hereby dismissed. The appellant has also raised one additional ground, which is purely a legal ground by which the initiation of reassessment proceedings under s. 147/148 has been challenged. 10. The learned Departmental Representative did not object to the admittance of....