TaxTMI 
TaxTMI 
2012 (10) TMI 278
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.... from the lead Asst.Year 2003-04 are as under:- 1. This is an appeal filed by the appellant firm and is against the order dated 04.12.2008 assed by the CIT(A) in the matter of assessment under section 143(3) read with section 147 of IT (the Act in short) for the assessment year. 2. Because the Commissioner of Income Tax (Appeals) has erred I facts and in law not justified in dismissing ground for reopening u/s.147/148 of the IT the appeal as infructuous instead of deciding the same on merits which order is contrary to facts and bad-in-law. 3. Because the Commissioner of Income Tax (Appeals) has failed to appreciate the facts and circumstances of the case and has erred in not deciding upon the validity of reassessment and order passed by the CIT(A)'s is erroneous and misconceived. Without prejudice to the above there is no reason to belief nor any valid reasons nor any income having escaped for the year under consideration. i.e. 2003-04 the reassessment proceedings initiated and the reassessment order framed there on is bad-inlaw and be quashed. 4. Because in any case on a proper consideration of the facts and circumstances of the same, the order passed under sect....
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....It was further gathered that the amount so deposited was withdrawals in "cash" by self/bearer cheques immediately after depositing the cheque. Shri Jabbarsinh Chouhan, Prop.of M/s.Girnar Sales Corporation and Shri Navin Raval, Prop. Of M/s.Shiv Metal Corporation had admitted in an affidavit duly notarized with Public Notary, that the accommodation bills were issued to certain parties without supplying any material. Thus, it appears that the assessee has inflated its purchases by R.11,12,460/- during the year under consideration." 4.2. For AY 2004-05, the AO has noted that Affidavits have been filed by the Proprietors of M/s.Girnar Sales Corporation and M/s.Shiv Metal Corporation and stated therein that they have issued accommodation bills to the assessee. As per the statement of accounts of M/s.Shiv Metal Corporation the impugned amount was stated to be Rs.4,65,695/- and in respect of the impugned amount pertaining to M/s.Girnar Sales Corporation was Rs.6,00,150/-. It was also noted by the AO that the assessee has received back the cash by way of encashing bearer cheques issued by the said two concerns in favour of the assessee. The AO has made the addition as per the following ....
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.... before us. 6. At the outset, ld.AR Mr.Anil R.Shah has placed reliance on a decision of ITAT "D" Bench Ahmedabad bearing ITA No.2801/Ahd/2008 for AY 2004-05 titled as "M/s.Sanket Steel Traders vs. ITO" and ITA No.2937/Ahd/2008 for AY 2004-05 (By Revenue) vide order dated 20/05/2011, the Tribunal has held as under:- "8. We have considered rival submissions and perused the material placed before us. First we shall consider the addition of Rs.26,76,559/- made by the Assessing Officer as unexplained payment. We find that the Assessing Officer in this case has made a thorough investigation. He had taken pain to trace the payment for purchases made by the assessee from the bank account and at page no.5 of the assessment order has recorded the finding with regard to each payment. Perusal of which clearly shows that the entire payment made by the assessee was by cheque and was debited in the assessee's bank account. Since the assessee has made the payment by cheque, which is duly debited in the assessee's bank account, the same cannot be said to be unexplained payment. Therefore, in our opinion, there was no justification for making the addition of Rs.26,76,559/- as unexplained payme....
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.... of Shri Anubhai Shivlal (supra) the FIAT has considered both the decisions in the case of Vijay Proteins and Sunsteel (supra) and thereafter sustained the disallowance at 12.5%. Relevant findings of the ITAT in the case of Anubhai Shivalal reads are under: "3. At the time of hearing before us, it is submitted by the learned counsel that the addition sustained is excessive. In support of this contention he referred to the decision of the Tribunal in the case of ITO Vs. Sun Steel 92 TTJ (Ahd) 1126 wherein the Tribunal has sustained the addition of rs.50,000/- on account of bogus purchases. However, we find that the facts in the above case were different. In the above case, the assessee has shown purchases of Rs.27,39,410/-. sale of Rs.28,17,207/-and GP at Rs.94,740/-. The Assessing Officer made the addition of Rs.27,59,407/- for bogus purchases. If the above sum is added to the GP. the GP works out Rs.28,34,1247/- which was more than the sale itself. The Tribunal held that it is impossible that the GP is more than the sale itself. The Tribunal also found that the assessee has maintained the quantitative details in respect of materials purchased and sold. Considering peculi....
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.... Rs.15,82,393/- The payment made to these parties during the year under consideration was as under: i) M/s.Girnar Sales Corporation Rs.21,18,369/- ii) M/s.Shiv Metal Corporation Rs. 5,58,190/- Rs.26,76,559/- The AO disallowed the purchase as bogus purchases and also made the addition for payment made to these parties as unexplained payment. Accordingly, the total addition made by him was Rs.42,58,952/- (Rs.15,82,393 plus Rs.26,76,559/-)." 7.1. Ld.AR has also informed that the issue of bogus purchases through accommodation bills has also been considered by this Bench in following two cases:- (a) ITO vs. Shri Sathynarayan P.Rathi (ITA No.3407/Ahd/2009 A.Y.2003-04) (b) ACIT vs. Kulubi Steel (ITA No.1568/Ahd/2008) 8. Under the totality of the facts and circumstances of the case, we are of the considered view that in respect of these two parties who have given accommodation bill to the assessee and on that basis the assessee has recorded bogus purchases in the books of account, however the Tribunal has consistently held that in view of the maintenance of quantitative details having followed the practice of purchasing goods from the ....