AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2017 (8) TMI 643
X X X X Extracts X X X X
X X X X Extracts X X X X
....IT(A) arising from the assessment order dated 16.03.2015 passed by learned Assessing Officer (hereinafter called "the AO") u/s 143(3) r.w.s. 147 of the Income-tax Act, 1961 (hereinafter called "the Act"). 2. The grounds of appeal raised by the Revenue in the memo of appeal filed with the Income-Tax Appellate Tribunal, Mumbai (hereinafter called "the tribunal") read as under:- "1. On the facts and circumstances of the case and in law, the Ld. CIT (A) has erred in granting relief of Rs. 58,92,281/- by deleting the addition made on account of bogus purchases from hawala parties." 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) has failed to appreciate the fact that the onus is one the assessee to e....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... physical delivery of the goods or by manipulating documents for such purchases. The assessee was listed as one of the beneficiaries who have taken accommodation bills for purchases from the following concerns:- Sr No. Name of the concerns Amount 1 Manav Impex 1,56,999 2 Kamlesh Trading Co. 7,42,040 3 Naman Enterprises 9,80,980 4 Ankit Enterprises 34,39,800 5 Coral Trading Co. 3,01,000 6 Adarsha Trading Company Pvt. Ltd. 11,13,216 TOTAL 67,34,035 Based upon the said information, the A.O. had reason to believe that income of the assessee had escaped assessment and the case was re-opened u/s 147 of the 1961 Act. Notice u/s 148 of the 1961 Act was issued by the A....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of by account payee cheques, the cheques have been deposited in bank accounts ostensibly in the name of the apparent sellers. (iii) This is information available in public domain form which, the assessee was well aware that he was entering into colourable transaction with alleged suppliers, as these suppliers are indulging in such transactions rig ht from their inception. (iv) Although no defects were pointed by the tax auditors, this is purely because of the combined effects of the two facts, namely on one hand audit was carried out on the basis of explanation furnished by vide his reporting in form No.3CD and on the other hand, tax audit is always carried out on a test check basis as it will be extremely difficult if not....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ved by the assessment order dated 16-03-2015 passed by the A.O., the assessee carried the matter in appeal before the ld. CIT(A) and the ld. CIT(A) after considering the submission of the assessee restricted the additions w.r.t. bogus purchases to the tune of 12.5% of the alleged bogus purchases, by observing as under, vide appellate order dated 03-05-2016:- "5.9. In the instant case, the appellant is not in a position to prove the existence of the suppliers. The averment of the appellant before the AO that no other records except purchase bills and payment details are maintained coupled with the result of the enquiries made by the AO, is enough circumstantial evidence casting a strong doubt on the nature of the transaction. I am o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....red rival contentions and also perused the material available on record. We have observed that the assessee is in the business of printing and publishing. The AO received information from the DGIT (Inv.), Mumbai that the Sales tax Department had carried out extensive investigation on various VAT dodgers (hawala operators) who were known to be issuing accommodation bills to various parties by issuing bogus bills without supplying actual material. The Investigation wing, Mumbai forwarded to the AO the list of beneficiaries who have taken accommodation entry, purchase bills without physical delivery of the goods or by manipulating documents for such purchases. The assessee was listed as one of the beneficiaries who have taken accommodation bil....
X X X X Extracts X X X X
X X X X Extracts X X X X
....and to evade taxes. The assessee was asked by the AO to prove genuineness of the purchase transactions. The assessee has only produced copies of invoices and ledger accounts along with proof of payment made to these parties through account payee cheque. The assessee had submitted that delivery challans are not maintained, nor the assessee could produce transport receipts, stock register or any other evidence to substantiate movement of goods. The assessee has claimed that the material purchased from these parties was used/consumed for its printing and publishing business but consumption/utilization of the said material for printing/publishing business of the assessee was not proved. The onus is on the assessee to prove consumption/utilizati....