2019 (8) TMI 114

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....sessment Year (AY) 1998-99. 2. In ITA No. 828/2005 while admitting the appeal on 21st September, 2005 the following question of law was framed for consideration: "Whether the ITAT was correct in law in confirming the order passed by the CIT (Appeals) holding that the provisions of Section 145(3) were not applicable completely ignoring the fact that the Assessing Officer has rejected the account books of the assessee?" 3. In ITA No. 833/2005 an identical question was framed subsequently when the said appeal was admitted by the order dated 21st March, 2006. 4. This Court has heard the submissions of Mr. Deepak Anand, learned Counsel for the Revenue and Mr. Ved Jain, learned counsel for the Assessees. 5. The background fac....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....sessees was confirmed to be from the persons of the Bamalwa Group who had declared silver in their VDIS declarations. 9. A perusal of the assessment orders dated 30th March, 2001 passed in each of these matters reveals that several opportunities were given by the AO to the two Assessees to furnish the complete names and addresses of the alleged 'buyers' of silver from whom cash had been received. No record was produced to explain how such a huge amount of silver was transported to Delhi. Since the Assessees were not able to substantiate the sales as declared in the books, the accounts were rejected and Section 145 (3) of the Act was invoked. 10. The AO on examining the accounts came to the conclusion that the Assessee had given accomm....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... cash was received was not furnished. Another letter dated 22nd March, 2001 was issued to them by the AO. Yet another opportunity was given to prove the identities, genuineness and creditworthiness of the persons from whom the Assessees had claimed to receive the cash. 13. In the case of the Assessee in ITA 828 of 2005, of the total 2570 bills, details only in respect of 10 bills were furnished where the amount involved was very small. Even in these cash memos the description of utensils and articles of silver items had not been mentioned. The total amount of cash sales was Rs. 29,90,06,343/-. 14. As regards the Assessee in ITA No. 833/2005, the AO found the situation to be no different. It was noted that the silver which the said Ass....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....d Jain, learned counsel appearing for the Assessees placed reliance on the decision of this Court in CIT vs. Jindal Dyechem Industries Pvt. Ltd. 2012 (4) TMI 423 to urge that the addition made by the AO on account of cash sales which was subsequently deleted by the CIT (A), which was concurred with by the ITAT, was not interfered with. The facts of that decision were entirely different and the amount involved was Rs. 1.20 crores. 18. The Court finds that in the present case the sales of over Rs. 30 crores in one case and Rs. 40 crores in another being put forth entirely as 'cash sales' had no valid basis in the books of accounts. It was obligatory on the Assessees to satisfactorily account for the creditworthiness, identity and genuinene....