TaxTMI 
TaxTMI 
TaxTMI 
2023 (1) TMI 493
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....eting the addition made on account of the non-genuine purchases; without a consideration that these parties themselves had given a declaration that they did not supply any material, but only accommodation bills ? 5.2 Whether in law, and on the facts of the instant case was the Tribunal was in error in not taking into consideration that an independent authority namely the Sales tax department had provided evidence of the fact that these parties did not undertake the sale of any material but only provided bills at a commission ?" 3. The present matter pertains to Assessment Year 2010-11. The Respondent had filed his Return of income for the relevant assessment year, declaring a total income of Rs.37,60,430/-. That Return was processed in terms of the provisions of Section 143(1) of the Act, and his case was selected for scrutiny and accordingly a notice under Section 143(2) of the Act, was issued to Respondent on 25.08.2011. Thereafter, a fresh notice under Section 142(1) of the Act, alongwith a detailed questionnaire was issued to the Respondent on 09.07.2012. In response, the Respondent filed his reply with various clarifications and details called for by the said notice. In his....
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....issioner of Income Tax (Appeals), allowed the same holding that the Respondent had proved the transactions by producing his books of accounts, banks statements and proved that the payments had been realized. On an appeal filed against the order dated 31.03.2017 has upheld the order of the Appellate Forum. 8. We have heard Mr. Suresh Kumar, learned Counsel for the Appellant and perused the records of appeal. 9. Mr. Suresh Kumar, learned Counsel submits that the Tribunal and the Commissioner (Appeals), have concurrently erred in holding that the transactions of the Respondent which were in question have been sufficiently proved. It is his submission that the burden of proving the transactions in terms of Section 69C of the Act, would not get discharge by merely producing such documents or by the production of the bank statements, invoices and books of accounts, and it was incumbent upon the Respondent to produce from the suppliers some evidence or proof of actual delivery of the material and of actual receipt of the amounts paid to them, notwithstanding that they were made through proper banking channels by account payee cheques. He further submits that the statements recorded by ....
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...., the Assessing Officer could not have proceeded to treat the purchases as unexplained expenditure. The Appellate Authority has then, after going through all the payments made by the assessee to those suppliers by perusing the bank statements of the assessee and ascertaining that the payments were made by account payee cheques, which had been credited to the bank accounts of the suppliers, concluded that the Respondent had in-fact proved the payments actually were made by him, and were not fictitious sales. 12. The Appellate Authority has specifically arrived at a finding that the Assessment Officer had accepted the correctness of the contracts executed by the Appellant with the suppliers, and having accepted the same, could not have proceeded to disallow the expenditure under the provision of Section 69C. of the Act. The Appellate Authority has then opined that the disallowance of the whole amount of Rs.4,99,27,664/- under Section 69C would result in abnormally high gross profit and net profit of the Appellant, which is unrealistic in any line of contract as has been executed by the Respondent. For all these reasons, the Commissioner of Income Tax (Appeals) at Mumbai, set aside ....
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....t of thereof, or by the explanation that is offered is not, in the opinion of the Assessing Officer satisfactory. The Assessment Officer, is therefore, called upon by the provisions of Section 69C to record his satisfaction based upon the material produced by the assessee and cannot advert to material such as unproved statements recorded by some other Authority such as the Sales Tax Department, which in any event were not put to assessee during the course of the assessment proceedings. 16. Principal Commissioner of Income-Tax (Central)-1 ..V/s.. NRA Iron and Steel (P.) Ltd., (supra), was the case in which, the Hon'ble Supreme Court considered a situation, where Share Capital/Premium was credited in the books of accounts of the assessee company, and such Share Capital/Premium was considered as transaction, which was not genuine, and therefore, treated as income of the assessee under Section 69C. It is in that context, that the Assessing Officer in that case, conducted an extensive investigation by holding an independent field enquiry to ascertain the genuineness of the investors in the assessee company. On the assessee being given an opportunity for meeting of the evidence collecte....