TaxTMI 
TaxTMI 
TaxTMI 
2017 (6) TMI 596
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....eafter assessment was framed u/s 143(3) r.w.s. 147 of the Act vide order dt.23.02.2015 and the total income was determined at Rs. 1,25,04,010/-. Aggrieved by the order of AO, assessee carried the matter before Ld.CIT(A), who vide ordet dt.27.02.2017 dismissed the appeal of the assessee. Aggrieved by the order of Ld.CIT(A) assessee is now in appeal before us and has raised the following grounds. "1. On the facts and circumstances of the case and in law the Ld. CIT(A), Aurangabad was not justified in passing the exparte appeal order holding the appellant in default to attend the appeal proceedings at Aurangabad. The appeal order be set aside. 2. On the facts and circumstances of the case and in law the appeal was originally filed before Ld. CIT(A), Thane. The appellant for the first time came to know that its appeal was transferred to Aurangabad Ld. CIT(A)-I on reading of the appeal order itself. No opportunity was given to appellant before transfer of such appeal proceedings. Then notices of hearing u/s 250 were not received by the appellant at Panvel. In the circumstances the exparte appeal order is not justified. 3. On the facts and circumstances of the case and in law fro....
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....e quoted before him which were in favour of the assessee. When two views are possible the Ld. CIT(A) ought to have followed the view favourable to the assessee. On this judicial principle no addition is sustainable. The addition be deleted." 3. Before us, at the outset, Ld.A.R. submitted that though the assessee has raised various grounds but the sole controversy which requires adjudication is with respect to addition of Rs. 31,62,752/-. 4. During the course of assessment proceedings, AO noticed that assessee had made various purchases which included certain purchases made from such dealers (who were considered to be suspicious dealers as per the list published by Sales Tax Department, Maharashtra) and wherein those suppliers had admitted to have issued bogus bills without delivery of goods to various parties. AO noted that Sales Tax Department had conducted investigations and unearthed fraudulent racket wherein certain parties had issued bogus bills without actual delivery of goods. On the basis of information passed on by the Sales Tax Department, survey action was conducted by the Income Tax Department in several cases. During the course of survey several beneficiaries admitt....
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..../outwards, weighment bills regarding weight of the goods received/sold, item wise complete details of purchases, sales, opening & closing stock. The relevant factors to be taken into consideration from the assessment order of AO are as under: i) The enquiries conducted by the Sales Tax Department revealed that M/s. Shah Industries was only providing accommodation bills. It was also admitted in its affidavit that no real business was conducted by it and no physical delivery of goods was ever given. After receipts of cheques, equivalent cash was given back after deducting small amount of commission. It also admitted that it had given blank invoices and blank signed cheques to the alleged beneficiaries. ii) The AO then directed the assessee to substantiate these purchases but in vain. The AO also directed the assessee to produce the above supplier but he failed to produce it. iii) The AO also directed the assessee to substantiate the alleged purchases with documentary evidences such as the confirmatory letter, lorry receipts, octroi receipts, weighment slips & quantitative details & other records in support of transportation of goods but the assessee failed to produce these d....
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....Tribunal held in the case of Balaji Textiles Industries Pvt Ltd Vs, ITO (49 ITD 177) that issue of bills by the alleged supplier was not a conclusive proof. In the case of CIT Vs. Golcha Properties (Pvt.) Ltd. (227 ITR 391) (Rajasthan HC), it was held that the genuineness of transaction, could be decided on the basis of primary facts on records. The department is not required to lead a clinching evidence to prove that purchases are bogus. There are number of decisions by the various courts, where 100% disallowance of bogus purchases, has been upheld. Some of these are enumerated as under : 100% disallowance of bogus / unverifiable purchases was upheld, in following cases : (i) Sri Ganesh Rice Mills Vs. CIT (2007) 294 ITR 316 (All) (ii) Khandelwal Trading Co. Vs. ACIT (1996) 55 TTJ (JP) 261. (iii) Swetambar Steels Ltd. Vs. ITO 707/1075/1262/1263/JD (2002) ITAT (Ahd) In the case of Swetambar Steels Ltd., the Hon'ble ITAT, Ahmedabad had confirmed the disallowance of the bogus purchase in entirety stating that the purchases shown from the respective parties were found in-genuine. It was not a matter to be looked into whether the assessee had made purchases from diffe....
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....ement of goods was not in doubt. In the present case, the goods have not been transported by the government approved transport contractors. The lorry receipts/truck numbers have not been furnished. Further the movement of goods is in doubt. There is nothing to indicate that the material so purchased was lying in the closing stock. The appellant has also placed reliance on the decision of Hon'ble Jodhpur Tribunal in the case of Income Tax Officer Vs. Permanand (2008)(25 SOT 11; 107 TTJ 395). In the cited case, the assessee had discharged the primary onus cast on him by section 69 of the Act by showing the purchases, their entries in the books of accounts, payments by way of account payee cheque, producing the vouchers of sales of the goods. In the present case, the appellant has failed to bring on record any evidence to prove that the alleged purchases were genuine. In the case of CIT Vs. Sunrise Tooling System (P) Ltd. (361 ITR 206), the director i.e. Shri D. K. Jain stated during the course of Survey U/s 133A that purchases of Rs. 43,34,496/- made by the assessee company from Shree Laxmi Industrial Corporation were bogus. However later on, he retracted from the statement. In....
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....nt can't deny that he had not been confronted with these evidences as the Sales Tax Department had issued show-cause notices to all the beneficiaries including the assessee and in majority of cases, VAT had also been collected from the beneficiaries. In the case of Smt. Kusum Lata Thukral (327 ITR 424) the Honourable Punjab & Haryana High Court had an occasion to deal with the same issue. In the cited case, the learned authorised representative of the assessee had sought annulment of the order on the ground that the assessee was not allowed to cross examine the donors. The Honourable High Court disagreed with this preposition. Whatever material the Assessing Officer had gathered was put to the assessee to comment. Therefore, the statements of the donors who had denied to have made any gift, had not been utilized against the assessee without affording the opportunity of the assessee. The assessee had not discharged the initial onus to produce the necessary evidence to support the genuineness of the transactions. The donors in their statements had denied to have given any gifts to Smt. Kusum Lata Thukral, the assessee. They had denied even the acquaintance with the assessee. Th....
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....s. The appellant has failed to produce the quantitative details. In view of facts and circumstances in the present case, I accordingly hold that the appellant has failed to prove the genuineness of purchases made from Mis Shah Industries. Accordingly the books of account of the appellant are rejected U/s 145(3) of the Act as these do not disclose true state of affairs. It was held by the Honourable Allahabad Tribunal in the case of Ishrawati Devi Vs ITO (298 ITR. AT 393) that the Commissioner (Appeals) has powers conterminous with those of the Assessing Officer. The Commissioner (Appeals) can direct the Assessing Officer to do what the latter failed to do. Unless there are specific fetters placed upon the powers of the Commissioner (Appeals) by express words, he exercises the same powers as does the original court or authority. In fact, the entire assessment is thrown open before him. He can travel outside the record, i.e, the return made by the assessee and assessment order passed by the Assessing Officer. He is competent to conduct a detailed examination of any aspect dealt with summarily or briefly by the Assessing Officer. Though the AO had not rejected the books of account in ....