TaxTMI 
TaxTMI 
2023 (10) TMI 464
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....om the grounds raised by the assessee as well as submissions raised before learned CIT(A) noted in para 6 of first appellate order, we note that the AO made addition by observing that Shri Himanshu Verma and Shri Anjani Kumar had admitted on oath that they were using companies for providing accommodation entries and the impugned purchase was not genuine. The AO after observing our factual position made addition in the hands of the assessee under section 69 of the Act by recording the finding that the entire money received back by the assessee from such companies amounting to Rs. 21,89,190/- requires to be added to the income of the assessee under section 69C of the Act. Before the authorities below, assessee submitted that the purchases cannot be treated as bogus if they are duly supported by the bills, payments have been made by account payee cheque or through banking channel, the supplier/seller has confirmed the transactions, there was no evidence to show that the purchase consideration paid to seller companies has come back to the assessee in cash, the sales out of purchases have been accepted by the Department and the supplier/seller has accounted for the purchases made by the....
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....ddition of Rs. 21,89,190/- on account of bogus purchases and second addition of Rs. 21,890/- on account of commission received by the assessee for arranging accommodation entries with following observations and findings: "7.1 In the present case, the AO had received information from the Asst Director of Income Tax (Inv.), Unit 6(3), New Delhi vide letter dated 18.09.2017 that a search operation was conducted in Himanshu Verma Group of concerns and it was found that Sh. Himanshu Verma was engaged in the business of providing accommodation entries by providing cheques/PO/DD in lieu of cash to a large number of beneficiary companies through various paper and dummy companies floated and controlled by them. As per the information received from the ADIT(Inv) Unit-6(3), New Delhi, one of such concerns was the appellant company which had received Rs, 21,89.190/- from the following two companies as bogus purchase during the previous year relevant to A.Y. 2011-12 as given hereunder: Sl. No. Name of the assessee PAN Name of the Himanshu Verma Group Company Amount (Rs.) Name of the entry operator controlling the entity 1 M/s AAA Teleshopping Pvt. Ltd. AAFCA 3709 E Ridhi Sid....
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....ion u/s 148 of the Act by recording the reasons to belleve in accordance with the provisions of the Act u/s 147 of the Act and, therefore, the same is hereby held to be valid 7.3 Notice u/s 143(2) was issued by the AO on 16.10.2018 Notice u/s 142(1) alongwith questionnaire was issued by the AO on 16.10.2018 The appellant failed to comply with the notice on 12.11.2018. As there was no response from the appellant, a show cause notice was issued on by the AO on 19/11/2018 asking the appellant to comply with the requirement of notice U/s 142(1) Vide the letter dated 19.11.2018 the appellant had submitted the copy of annual reports and financials list of items dealt with by the appellant copy of invoices along with ledger copies of telephone and advertisement expenses. However, the appellant did not submit any reply in response to questionnaire issued with Notice u/s 142(1) of the IT Act. On 27.11.2018 the appellant had appeared before the AO and submitted commission on sale and purchase invoices of M/s Sri Hari Clothing Co Ltd and M/s Ridhi Sidhi Clothing Co Ltd, sundry creditors and their details along with the address. The AO had also informed the appellant that letters u/s 133(6) ....
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.... statements recorded during the search and after that, bank statement of the parties. The appellant has been given all the evidences which are used for concluding the assessment. 7.5 Accordingly, the AO concluded that the appellant has made bogus purchases from these two companies. The appellant was provided with copies of statements of Shri Himanshu Verma dated 29.03.2012 during the course of scrutiny assessment on 08.12.2017. The AO had asked the appellant to explain as to why the addition u/s 69C of the IT Act should not be made in its case for an amount of Rs 21,89,190/- received from Ridhi Sidhi Clothing Co Pvt. Ltd and Sri Hari Clothing Co Pvt. Ltd in respect of accommodation entry in the form of bogus purchases Shri Himanshu Verma and Shri Anjani Kumar had admitted on oath that they were using these companies for providing accommodation entries. Accordingly, the AO has held that the money received by the appellant during FY 2010-11 from these two companies controlled by Shri Himanshu Verma was not a genuine purchase. The entire money received from such companies amounts to Rs. 21,89,190/- which has been added by the AO to the income of the appellant u/s 69C IT. Act. The AO....