TaxTMI 
TaxTMI 
2020 (4) TMI 462
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....rnment was moved. On the other hand, Ld. DR is present in the court and is ready with arguments. Therefore, we have decided to proceed with the hearing of the case ex-parte with the assistance of the Ld. DR and the material placed on record. 3. The brief facts of the case are that assessee electronically filed its return of income on 24.09.2012 declaring total income at Rs. 84,40,950/-. The assessee is a trader in cut and polished diamonds. Subsequently, the case was reopened u/s 147 on the basis of information received from DGIT(Inv.), Mumbai, that assessee was engaged in the practice of inflating the purchases by taking bogus bills from hawala parties without delivery of goods. It was also informed by the office of DGIT(Inv.), Mumbai t....
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.... reflected in the books of M/s Marc Gems as well our books and books of accounts of both the concerns are audited without any qualifications by auditors. 5. The purchase from M/s Marc Gems is in normal course of business which can be proved by stock summary provided to your good self. 6. We did not enter transaction of whatsoever nature with the said Shri. Bhanwarlal Jain as alleged by you. 7. We do not have any business connection with Mr. Bhanwarlal Jain and not entered in any kind of transaction with him or his group known to us. 8. Further we would like to bring to your notice that we have paid the purchase proceeds to M/s Marc Gems through proper banking channel only. Therefore, your allegation that ....
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.... reflects the purchase consideration of 22 acres at Rs. 3,62,18,000/. The third party statement and unsigned agreement cannot be acted upon", b) CIT-22(1) v/s G V Sons, ITA No.2239/Mum/2012, it is held that "Simply on the basis of statement given by the third party, that they were also providing accommodation entries as well, the conduct of the assessee cannot be doubted and held to be sham. 10. We request you to provide the material in support of your claim that we have entered non genuine purchase transaction with M/s Marc Gems. 11. The notice issued by you u/s 133(6) of the act is property served to M/s Marc Gems and in response to the same party already sent their reply via registered post on 20.12.2017 (copy ....
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....ase invoices are not shown anything about the cut, colour, clarity, shape of diamond. In this type of business, the 4 c's are relevant i.e. cut, colour, clarity and carat weight are relevant. Ld. CIT(A) agreed that the sellers are not aware of the technical evaluation of the diamond quality and he agreed that the purchases made by the assessee cannot be treated as genuine. However, he observed that AO did not doubt the sale component and accepted the sale declared by the assessee. In order to make the sales, assessee must have purchased from other parties and completed the transactions. In this respect, Ld. CIT(A) relied upon following case law:- i) Bholanath Poly Fab Pvt. Ltd. 355 ITR (Guj) ii) ITO vrs. M/s Shah Diam (ITA....