TaxTMI 
TaxTMI 
2023 (8) TMI 1270
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.... of income was filed on 28.09.2011 declaring total income of Rs.. 4,79,210/-. The return was processed u/s. 143(1) of Income-tax Act, 1961 (in short "Act"). Subsequently the case was reopened by issue of notice u/s. 148 of the Act dated 11.03.2016. In response assessee filed original return filed on 28.09.2011 and requested to treat the same as return filed in response to the notice issued u/s. 148 of the Act. Subsequently notice u/s. 143(2) were issued and served on the assessee. 3. The Assessing Officer received information from the office of the Director General of Income-tax (Inv.), Mumbai wherein it is stated that information received from Sales Tax Department, Government of Maharashtra regarding cases involving bogus purchases/hawala....
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....nk statement of the parties reflecting the payment received for the goods sold to the assessee 5) Statement of corresponding sales/consumptions if any along with stock register. 6) Copy of bills/invoices in respect of purchase parties in question along with bank statement showing payment to the above mentioned parties. 5. In response, Ld. AR of the assessee submitted as under: - "..... 1. Our client has not made any trading purchases but had purchased a huge colour printing machine. The same was capitalized and has not been debited to Profit & Loss account. Hence, No expenses has been claimed on this account The same was capatilised and has not been debited to Profit & Loss account. Hence, no expenses has been claimed on this acco....
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....he following observations: - "7. The contention of the assessee has been considered but not found acceptable. The contention that the payment was made by account payee cheque is not a full fledged-safe method of substantiating the assessee's claim as it is already accepted by the persons, whose statement, deposition or affidavit was recorded by the sales tax department of Maharashtra as discussed above, that cash is returned after deducting commission/brokerage once cheque is realized. Further, the assessee has failed to produce the party and has also failed to provided the proof for the delivery of the said machinery through factory gate pass, delivery challan, octroi slip, lorry slip, delivery challan, etc. Also the inquiry notice s....
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....arious parties. Therefore, burden lies on the assessee to prove that the said facts (Section 101 and 103 of Indian Evidence Act 1872). Secondly, the payment made to the purchase parties are within the knowledge of the assessee. Therefore, the burden is on it to establish that fact. However, the burden has not been discharged by the assessee. 9. It is pertinent to note here that the material has been received by the assessee from the sources best known to him. At the same time, it is also possible that assessee purchased machine from some other suppliers and received bill from some one else which is commonly known as grey market from the sources best known to him. In view of the above, the said expenditure to the tune of Rs. 28,12,500/- i....
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.... Government of Maharashtra and the supplier being one of the suspected Hawala trader, the case of the assessee was reopened. Assessing Officer has disallowed the whole value of the machinery along the depreciation claimed by the assessee. He submitted that assessee has submitted all the details relating to the purchase of the machinery before the Assessing Officer and he submitted that assessee has proved the genuineness of the transaction by filing the Photos of the machinery before the Assessing Officer. Further, he brought to our notice Page Nos.4 and 5 of the Paper Book wherein assessee has submitted the various details and also the invoice and bank statement in support of making payment and photocopy of the machinery which was installe....
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....d by the Coordinate Bench in the case of Sashai Natwar Waghela v. ITO (supra). The relevant decision is reproduced below: - "6. The assessee in order to prove the genuineness of the purchase has furnished invoice and the sanction letter of the bank. The assessee had financed the purchase and installation of the machine from Andhra Bank. The bank had certified that payments were made to. M/s. Span Enterprises, the vendor and M/s. Jupiter Graphics, who had installed the machine. This fact has not been rebutted by the Department. It is noteworthy that the machine was purchased during the financial year 2008-09 and Inspector visited the premises of the vendors in December, 2014. The possibility of vendors shifting the place of business in bet....