TaxTMI 
TaxTMI 
TaxTMI 
2024 (6) TMI 540
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....dly reopened the assessment u/s 147 of the Act. 3. Facts in brief are that the assessee company filed return of income on 28.09.2012 declaring total income of Rs. Nil under the normal provision of the Act. The said return was processed u/s 143(1) of the Act 26.11.2013. Thereafter the case of the assessee was reopened u/s 147 of the Act on the ground of bogus billing in the guise of purchases to the tune of Rs. 38,75,000/- from M/s Chakradhari Industries. During the year, the notice u/s 148 was issue don 31.03.2019 which was complied with by the assessee by filing return of income on 29.11.2019 returned in the same income as filed in the original return of income. Finally in para 3.1. on the last line the AO noted that the assessee has rece....
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....ilarly the A.R has relied on the decision of Co-ordinate Bench in the case of Raghavendra Mohta vs. ACIT in ITA NO. 2416/Kol/2017 dated 08.04.2024. Arguing the second limb of argument, the Ld. A.R submitted that the reasons were recorded u/s 148(2) of the Act at the time of re-opening the assessment wherein the AO noted that the assessee has received Rs. 38,75,000/- from shell entities. The Ld. A.R by referring to the assessment order stated that in the reasons recorded the AO stated that the assessee has received Rs. 38,75,000/- from M/s Chakradhari Industries whereas the assessee has not received any such sum from the said party. In fact the assessee has procured raw material from the said party amounting to Rs. 47,03,192/- against which ....
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.... to unexplained expenditure where in any financial year an assessee has incurred any expenditure and he offers no explanation about the source of such expenditure or part thereof, or the explanation, if any, offered by him is not, in the opinion of the AO, satisfactory, the amount covered by such expenditure or part thereof, as the case may be, may be deemed to be the income of the assessee for such financial year . But in the present case, the Ld. A.R argued that the purchases were duly recorded in the books of account and the source of said purchases was also duly disclosed by the assessee in the books of accounts. Therefore the AO has grossly erred in invoking the provision of Section 69C of the Act. The order passed by AO is invalid in ....
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....ed by the AO is bad in law and may kindly be quashed. 6. The Ld. D.R on the other hand relied heavily on the order of authorities below by submitting that the re-opening was made on the basis of specific information that the was some wrong doings by the assessee. The ld DR submitted that the correct picture will only come out after the investigation/examination of various evidences are carried out during assessment proceedings. Therefore to say that there was no addition by the AO of the issue which was subject matter of the reasons recorded is wrong. The ld DR submitted that the addition was made which was connected to the reasons recorded. Similarly was the position with regards to addition made u/s 69C as the assessee could no0t submit ....
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....e assessment framed by the AO is invalid and cannot be sustained. The case of the assessee finds support from the decision of Hon'ble Calcutta High Court in the case of M/s Infinity Infotech Parks Ltd. (supra)and also on the decision of Co-ordinate Bench in the case of Artex Property Consultants Pvt. Ltd. vs. ITO (supra) and in the case of Babita Devi Kajoria vs. ITO(supra). We also note that the Hon'ble Calcutta High Court while passing the decision, has followed the decision of Hon'ble Bombay High Court in CIT Vs. Jet Airways India Ltd. in 331 ITR 236 (Bom). 7.1. Similarly we note that the AO has addition u/s 69C of the Act in respect of bogus purchases however the provisions of section 69C are applicable only to unexplained expenditure ....