TaxTMI 
TaxTMI 
2018 (10) TMI 1780
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....rough the complete list and indentifying the parties and after recording the reasons, the AO made an addition of Rs. 79,86,868/- on account of bogus purchase and completed the assessment at an income of Rs. 84,29,480/- u/s. 143(3)/147 of the I.T. Act, 1961 vide his order dated 06.03.2014. Against the order of the AO, the assessee came in appeal before the Ld. CIT(A), who vide impugned order dated. 18.03.2016 not only dismissed the appeal of the assessee but also enhanced the addition made by the AO of Rs. 79,86,868/- to Rs. 99,78,004/- which includes enhancement of Rs. 3,93,705/-on account of commission paid on obtaining the accommodation entries and enhancement of 20% of the purchases of Rs. 15,97,431/- on account of understatement of the profit for the same. Aggrieved by the order of the Ld. CIT(A), the assessee filed this appeal before the Tribunal challenging the reopening of the assessment as well as the additions sustained/made by the CIT(A). The said appeal came up for hearing before this tribunal. The ITAT vide order dated 25.5.2017 held that reopening of the assessment was bad in law. Since the reopening was held to be bad in law, the ITAT did not adjudicate upon the other....
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....being purchased by the assessee was found, which confirms the fact that these firms were doing actual business. (ii) On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law in rejecting that the inference drawn by the AO merely on the basis of a statement that these firms are not in actual business is baseless and contrary to the facts on record. 6. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law in rejecting the contention of the assessee in ignoring the fact that the quantity purchased and sold being completely tallying, the allegation that the assessee has not made purchases cannot be sustained. 7. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law in confirming the addition on account of bogus purchases, rejecting the material and evidences brought on record by the assessee to show that the purchases and sales were made in the regular course of business. 8. (i) On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in enhancing the addition made by the AO by an amount of Rs. 3,93,705/- ....
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....o surmises and conjuncture. It was further submitted that similar additions were made by the AO on the same set of facts for the same assessment year in other cases. Those cases have been subject matter of appeal before the ITAT and after examination of all the facts, the ITAT has deleted the entire addition. The Ld. AR placed a list of the cases where similar issues have come up before the ITAT and the additions have been deleted. At the time of hearing, Ld. Counsel for the assessee has stated that the issues involved in the present appeal is squarely covered by the judgement of ITAT Delhi, dated 28.10.2015 in the case of Unique Metal Industries vs ITO in ITA No. 1372/Del/2015 and others various orders applying the same ratio. In reply, the LD. DR relied upon the order of the authorities below. 5. We have heard both the parties, perused, and considered the relevant records available with us specially the impugned orders passed by revenue authorities and copy of the Tribunal's order dated 28/10/2015 passed in the case of Unique Metal Industries vs. ITO in ITA No. 1372/Del/2015. 5.1 On perusing the assessment order we note that the additions have been made on the allegation that a....
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....business of scrap but also stock of scrap was also found with them. 25. The department has also made assessment of these persons in respect of the business of scrap carried on by them. The Revenue is doubting the purchases of the assessee on the basis that these persons have made a statement that they have issued accommodation bills and have not made actual sales to the assessee. Can such statements be taken at its face value? If these people were engaged in the scrap trade as contended by the learned AR then there is every possibility that these persons would have collected the scrap for which they were not having any invoices or source of supply and have sold the same to the assessee and to various other parties. On being caught at wrong foot these persons have taken the defence that the sales made by them are not genuine and they have issued accommodation bills. In the present case the assessee had made purchases and there are corresponding sales. These sales are not being doubted. If sales are not being doubted, then obviously purchasing would be there. Now the learned CIT(A) held that purchases made by the assessee are not genuine and the assessee would have made purchases f....
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....riven carts and the charges for the same are debited under the head cartage. Further when sales are accepted as genuine, then definitely the transactions have occurred and movements of goods have taken place. It is also not the case of the learned CIT(A) that transactions has not happened. Thus transaction on such facts cannot be a basis to draw adverse inference against the assessee. I further note that the learned CIT(A) has upheld the allegation of the Asses sing Officer of the bogus purchases by making an observation that the appellant's dealing with these parties is not free from any doubt. It is a settled law that doubt cannot be a basis for sustaining the allegation. On the contrary the assessee had lead sufficient evidences in support of its purchases which the assessing Officer in my view has not been able to rebut. Accordingly I am of the view that in the facts and circumstances of the case it cannot be said that the purchases made by the assessee are bogus. 27. As regards the additionof20% sustained by the learned CIT(A) I am of the view that since purchases are not bogus the addition on this account cannot be sustained. Even otherwise the addition of 20% on the facts ....