TaxTMI 
TaxTMI 
2018 (5) TMI 1490
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.... Petitioner is a private limited company and is engaged in the business of dealing in paper and board. For the assessment year 2011-12, the petitioner had filed return of income. The assessee had shown purchases worth Rs. 4.33 crores from one M/s. Tarini Trading Pvt. Ltd. During the course of reassessment proceedings, the Assessing Officer doubted the genuineness of such purchases on the basis of information received from the VAT department at Mumbai. The Assessing Officer called upon the assessee to prove such purchases and desired to examine the vendor i.e. representative of M/s. Tarini Trading Pvt. Ltd. The assessee was accordingly asked to produce such representative. Assessee complied with such directions. Shri Rajkumar Sharma, Directo....
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.... the already offered GP at the rate of 1.79%. Eventually, he has scaled down his addition from Rs. 17.33 lacs as originally proposed, to Rs. 9.57 lacs made in the order of assessment. 4. The assessee carried the matter in appeal before the Commissioner (Appeals). The assessee desired that the entire addition be deleted. While this issue was thus pending before the Appellate Commissioner, the present respondent issued the impugned notice seeking to take the order of assessment in suo motu revision. His sole ground was that the Assessing Officer having held that the entire purchase of Rs. 4.33 crores from M/s. Tarini Trading Pvt. Ltd. being bogus, had erred in limiting the addition to only Rs. 9.57 lacs on the basis of gross profit ratio. ....
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....late Commissioner, the petitioner filed a detailed reply to the impugned show-cause notice on 13.02.2018. In such reply, the assessee took various contentions, principal being that the order of assessment was neither erroneous nor prejudicial to the interest of the Revenue and further that the Appellate Commissioner having already granted relief to the assessee, on this very ground, on the principal of merger also, the revisional powers would not be available. 7. Appearing for the petitioner, counsel Mr. Hemani raised two principal contentions: (i) That the Commissioner was wrong in observing that the Assessing Officer had held that the purchases were bogus. This was contrary to the findings of the Assessing Officer and the impu....
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.... Officer did not dispute this transaction any further while accepting this factum of the genuineness of the purchases made by the petitioner. He noticed that the goods were delievered directly to the petitioner's purchaser and the petitioner was not billed for such transportation. In his opinion therefore, the petitioner should have disclosed higher profit since he was rid of the transportation charges. He put the petitioner to notice and made addition @ 4% GP on the gross turnover. In the process, he gave benefit of the profit already disclosed by the petitioner. 10.Two things thus immediately become clear. First that the Assessing Officer did not hold that petitioner's purchases from M/s. Tarini Trading Pvt. Ltd. were bogus. In....
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....g Officer. The limited additions made by the Assessing Officer and the larger additions proposed by the Commissioner in the impugned notice are inextricably inter linked. The Commissioner argues that the entire purchases were bogus. The Assessing Officer accepted the purchases as genuine but added certain amount on the premise that the assesse's profit from such dealings would have been higher than disclosed. The entire issue was at large before the Appellate Commissioner. It is well known that the Commissioner (Appeals) while hearing the assessee's appeal has powers to even enhance the assessment. If he was of the opinion that not only limited additions made by the Assessing Officer but much larger additions were justified, he coul....
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....the principle of merger and avoids any conflict of opinion between two quasi judicial authorities of the same rank. This issue has been considered at length by Division Bench of this Court in case of Nirma Chemicals Works P. Ltd. (supra). It was held as under: "20. The stand of the revenue that the assessment order was silent as regards eligibility or otherwise of section 80-I of the Act cannot thus be accepted. As noted hereinbefore the entire section lays down a complete codified scheme in itself for deciding not only the eligibility but also for the computation of the relief to which the assessee is entitled. When the section talks of profits and gains derived from an industrial undertaking the requirement is in relation to the ....