TaxTMI 
TaxTMI 
2015 (11) TMI 750
X X X X Extracts X X X X
X X X X Extracts X X X X
....en operating from Ahmedabad. The array of supplied products reads consumable stores, spheres for furnished division, lathe machine, water pump set, polishing machine, straightening machine, sharper machine and other plant and machinery, send filing work for their new projects etc. The assessee had shown further purchases of fixed assets of Rs. 75,17,932/- from another entity M/s. D & H Enterprise operating from the very Ahmedabad address. The authorized signatory at both the entities' behest happened to be the same person. The Assessing Officer accordingly sought from assessee return of income filed by both this concerns, their bank statement and narration of major entries. The assessee appears to have furnished return of M/s. Collective Marketing Pvt. Ltd. only Rs. 41,095/-. The Assessing Officer perused its bank statement demonstrating its dealings with assessee only. He further noticed that each credit payment instance in assessee's case corresponded to a withdrawal of cash amount to almost the same extent through self and bearer cheques. He also took into consideration the fact that the assessee had not submitted the relevant details of later entity M/s. D & H Enterpris....
X X X X Extracts X X X X
X X X X Extracts X X X X
....aid party mentioning Invoice No., rate, Party's Sales Tax No., total amount etc. are there on page 51 to 53. 13. The assessee company to negate the contention of the Assessing Officer that purchases from Collective Marketing Pvt. Ltd. appears to be not genuine, has further filed purchase bills of the said company, i.e. Collective Marketing Pvt. Ltd. and are relevant to the period 1-4-2006 to 31-3-2007 only. Thus how Collective Marketing Pvt. Ltd. procured these materials and after doing necessary fabrication supplied to the assessee company these assets stands discharged. The assessee company has also filed copy of the account of the assessee company in the audited books of Collective Marketing Pvt. Ltd. on Page 73 to 75 wherein various suppliers and sources of the said company, loans taken by it including term loan, cash credit etc. from UCo. Bank are appearing. This proves the numerous transactions the said Collective Marketing Pvt. Ltd. had undergone to purchase the material and in turn supplied the assets to the assessee company. Moreover, the assessee company also filed bank statement with UCO Bank, Ashram Road Branch, Ahmedabad of the assessee company whereby pay....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e existence and verification of all these assets. 15. My view gets further strengthen from the copies of the audited accounts, wherein the auditors in their Auditors Report appearing on Page 12 of the Paper book have confirmed that the assessee company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. The auditors have also certified that fixed assets have been physically verified by the Management in accordance with a programme of verification, which in the opinion of the auditors provides for physical verification of all the fixed assets at reasonable intervals. When the assessee company, which is a public limited company is subject to Internal Audit, Statutory Audit as well as Tax Audit and when the Auditors in their CARO report certified that in the assessee company there are adequate internal control procedures commensurate with the size of the company and the nature of its business for the purchase of inventory and fixed assets etc,. I see no doubt or suspicion with regard to treating the Fixed assets as bogus. The Assessing Officer has not brought any material or evidence except mentioning that purch....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ted its bill pertaining to purchase of the fixed assets in question i.e. rough forged blanks for rolls by way of three deals dated 22.03.2007 form M/s. Tirupati Industries at Malerkotla, Punjab aggregating to Rs. 1,26,65,952/-. It claim depreciation @80% on the same stating use of these assets for less than 180 days in the relevant previous year. The Assessing Officer sought for necessary details of transportation, delivery and "put to use" of these rolls. He quoted assessee's failure in filing the same. This lead to disallowance of depreciation of Rs. 50,66,381/- and additional depreciation of Rs. 12,66,595/- on the above stated rolls being made in the assessment order in question. 6. The assessee appears to have filed additional evidence qua this issue as well i.e. copy of the necessary bills (already on record), certificate of an engineer confirming that rolls were put to use and transport receipts thereof. The CIT(A) sought for a remand report qua this issue as well and accepted assessee's corresponding ground as under: "16. The next ground of appeal is with regard to the disallowance of depreciation of Rough Forged Rolls. The assessee company in its written....