TaxTMI 
TaxTMI 
TaxTMI 
2023 (4) TMI 279
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....rprises and M/s Shakti Enterprises, to whom, total credit entries of Rs.1,43,85,000/- had been transferred; that in response, the assessee had furnished only the copies of invoices in support of the purchases made from M/s Yuvraj Enterprises; that further, summons under section 131 of the I.T. Act had also been issued to the assessee for providing complete books of account along with purchase bills, sale bills and mode of transportation of purchases, freight, receipts/bilties, etc.; that the statement of Shri Gaurav Pathak/Thakur, proprietor M/s Yuvraj Enterprises and M/s Shakti Enterprises was recorded by the DDIT (Investigation), Ludhiana, in which, he had stated and confirmed that there was no business conducted in these concerns and these were formed only for the purpose of providing accommodation entries and that the amounts received by cheque were returned in cash, etc.; that from the statement of Shri Gaurav Pathak/Thakur, proprietor M/s Yuvraj Enterprises and M/s Shakti Enterprises, it had clearly transpired that purchases shown by the assessee from M/s Yuvraj Enterprises were not genuine and the expenses had been claimed to reduce the profits; that the Assessing Officer ha....
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....rmed only for the purpose of providing accommodation entries and that the amounts received by cheque were returned in cash; that thus, the claim of payment by banking channels should not have been accepted on face value without making further enquiries; that however, no enquiry of any worth had been conducted by the Assessing Officer; that the assessee had also submitted that he had availed the scheme under The Direct Tax Vivad Se Vishwas Act, 2020 against the assessment order, which was accepted by the Department; that however, this fact had no effect on the issue which had been left to be investigated by the Assessing Officer; that as such, it was evident that the assessment order had been passed without enquiries or verification; that the Assessing Officer did not enquire/verify about the complete details and documentary evidence regarding the credit entries as appearing in the bank account, at Rs.1,43,85,000/-; that therefore, the Assessing Officer's order was erroneous, as the Assessing Officer did not enquire/verify about the complete details and documentary evidences of availability of cash for the said cash deposits and it was also prejudicial to the interests of the Re....
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....er account of the relevant parties as in his books; that the assessee had filed detailed reply and arguments before the Assessing Officer, stating that these purchases were genuine and that no addition on this account could be made; that on considering the issue, the reply of the assessee and the position of law, the Assessing Officer did not agree that the purchases were genuine; that he made addition, for which, he applied a GP rate of 1.03% on the quantum of purchases, thereby, making addition of Rs.1,48,165/-; that against the assessment order so passed, the assessee filed an appeal before the ld. CIT(A) on 8.1.2020; that therein, the assessee challenged the reopening of the completed assessment under section 148 of the I.T. Act and also the addition made by applying the GP rate; that while the appeal was pending, The Direct Tax Vivad Se Vishwas Act, 2020 came into force and the assessee opted for the same and settled, thereunder, the dispute regarding the addition made by the Assessing Officer concerning the alleged bogus purchases; that the ld. PCIT issued Certificate dated 2.4.2021, towards final settlement under the Direct Tax Vivad Se Vishwas Act, 2020, in Form No.5; that ....
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.... issue regarding purchases had been thoroughly examined by the Assessing Officer in the assessment proceedings and it was only thereafter, that the addition had been made by the Assessing Officer, by applying the GP rate; that as such too, jurisdiction under section 263 of the I.T. Act was wrongly invoked by the ld. PCIT. 9. In this manner, the ld. Counsel for the assessee has requested that the order under appeal be quashed on allowing the appeal filed by the assessee. 10. The ld. D.R., on the other hand, has placed strong reliance on the impugned order. It has contended that, as correctly observed by the ld. PCIT, the assessee did not produce the complete books of account along with purchase bills, sale bills and mode of transportation of purchases, freight, receipts/bilties, etc., during the assessment proceedings before the Assessing Officer; that the Assessing Officer did not carry out any investigation whatsoever into the matter, despite the fact that the proprietor of M/s Yuvraj Enterprises and M/s Shakti Enterprises had stated before the DDIT (Investigation), Ludhiana that no business had been conducted in the two concerns and that they had been formed merely for the purp....
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....ing the amount payable under this Act, shall be conclusive as to the matters stated therein and no matter covered by such order shall be reopened in any other proceedings under the Income Tax Act or under any other law for the time being in force. There is, thus, an express bar to proceedings being continued/reopened under any law, including the Income Tax Act, once an order stands passed under section 5(1) of the Direct Tax Vivad Se Vishwas Act, 2020 determining the amount payable and concerning any matter covered by such order is not to be reopened. 16. In "Gopalkrishan Rajkumar vs. PCIT" (supra), the question before the Hon'ble High Court was, as is the case herein, as to whether the proceedings initiated after the assessee had opted to settle the dispute under the Direct Tax Vivad Se Vishwas Act, 2020, were sustainable or not. Their Lordships held, inter alia, that section 6 of the Direct Tax Vivad Se Vishwas Act, 2020 makes it very clear that once there is compliance with the timelines specified under section 5, the designated authority shall not institute any proceedings in respect of an offence or aims or levy any penalty or charge any interest under the Income Tax Act ....
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....s estopped from taking any steps which would in effect amount to reopening and/or revising the decision already taken on such declaration; that the IDS scheme was introduced in order to encourage an assessee to make a disclosure of the income not disclosed earlier; that the PCIT invoked power under Section 263 of the I.T. Act in respect of an item of income which was declared in terms of the said scheme; that all particulars were available before the PCIT in respect of such income and the PCIT, on being satisfied, accepted such declaration; that thus, if the contention of the Revenue that the PCIT has power to invoke Section 263 of the Act were to be accepted, it would frustrate the object behind introduction of such scheme; that the PCIT was not justified in invoking the power under Section 263 of the Act, as it would amount to revising a decision taken by the PCIT on such declaration by the Assessing Officer, which is not contemplated under the Income Tax Act; that thus, all materials were available before the PCIT when the declaration made under Section 183of the Finance Act were considered and accepted; and that therefore, the assumption of jurisdiction by the PCIT under Sectio....