TaxTMI 
TaxTMI 
1999 (10) TMI 8
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...."). Along with its return filed on July 28, 1984, showing the total income at Rs.60,814 a statement showing computation of total income was filed along with copies of the profit and loss account, manufacturing account, balance-sheet and partner's capital account. It appears that the Assessing Officer issued show-cause notice on January 23, 1987, pointing to the assessee as under: "On an inquiry with the sales tax authorities as also with the Income tax Officer, Junagadh (who is having the jurisdiction over Keshod), it is learnt that Geeta Industries which is alleged to be the proprietary concern of one Shri Kishorechandra Hansraj at the given address at Keshod is merely a billing agent and there is no genuine seller as such. It has come ....
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.... the stage of receipt of goods to final production is mentioned in the annexure. (d) From the said details, it is to be stated that the goods from the said party have been received and have gone into production. This can be verified from the gate pass, avak chitti and weight chitti-supporting of all are enclosed herewith. (e) The said goods are sent to laboratory for report and sample report, etc., are also sent herewith. From the sample report quality difference is arrived and the party is also paid the difference or recovered also from the party, as the case may be. (f) The said goods are entered in our day-to-day receipt register where the assessee is entering all the 'receipt (sic) cakes. (g) These goods are produced and the....
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.... Geeta Industries. (q) In view of this, the question of taxing these purchases in the hands of the firm does not arise." The Assessing Officer considered the materials and found that the statement with regard to the transaction could not be confirmed by one Mahesh, a partner of Vadilal Popatlal and Sons. The Assessing Officer also found that the Dalal as per letter dated February 18, 1996, produced copy of the bill dated December 5, 1983, issued in favour of the alleged party, Geeta Industries, for Rs.5,100 being brokerage received by cash for sale of oil cake. It appears that thereafter the said firm was reconstituted in the name of Maganlal Vashram and Sons. Maganlal Vashram and Sons had totally blank books of account. The Assessing....
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....orded in the books of account. The trading account was backed up by detailed quantitative particulars. Before the Assessing Officer, the bills were produced from the four parties from whom it was alleged that the purchases were made were not genuine. At the time the purchases were made these were registered dealers under the sales tax law. The observations of the Assessing Officer that these people had also operated a bank account from the same bank and the amounts credited to their accounts were promptly withdrawn may give rise to some suspicion but there was no evidence to show that the assessee had not made any purchases. At best it could be inferred that these parties were set up by somebody else and the reasons could be manifold for th....
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....the assessment year 1985-86 with Arun Industries and dropped the proceedings for the assessment year 1985-86. The Assessing Officer believed the existence of Geeta Industries for that year. Not only this but it appears that Geeta Industries was supplying materials not only to the assessee but to others. In the case of Arun Industries, the amount paid to Geeta Industries was disallowed. However, the Tribunal on appreciation of evidence deleted the entire disallowance which has been upheld by this court and by the apex court as observed in para. 2.4 of the judgment of the Tribunal. In Arun Industries against the decision of the High Court, SLP was preferred by the Revenue and the same has been rejected. The Tribunal has considered that asp....