TaxTMI 
TaxTMI 
2022 (6) TMI 1509
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....ated in ITA No.889/AHD/2017 for AY.2007-08 in the case of Keshri Export has been considered for deciding above appeals en masse. 3. Brief facts qua the issue are that certain information was received from the Investigation Wing, Mumbai that certain parties on whom search action has been carried out by them have admitted during the search proceedings that they have been providing accommodation entries by way of issuing non-genuine bills/loans. From the names/details provided during the search proceedings, the name of M/s. Jewel Diam and M/s Kothari & Company also figures. The assessee is a beneficiary of nongenuine transaction of Rs.1,53,34,095/- from the said parties. During the post assessment proceedings, based on the information available on record, reason were recorded under section 148(2) and after taking prior approval from the appropriate authority, notice under section 148 was issued on 28.03.2014 and duly served upon the assessee by speed post. In response to the notice under section 148 issued, the assessee furnished its reply dated 01.04.2014 statign that the return filed on 31.01.2007 may be taken as return filed in response to the notice issued under section 148 of th....
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....of this Tribunal in group case in Pankaj K. Chaudhary (supra) vide order dated 27.09.2021. In this order, the Tribunal has inter alia observed as follows: "17. We have considered the submissions of the parties and have gone through the order of the lower authorities. We have also deliberated on each and every case laws relied by both the parties. We have also examined the financial statement of all the assessee(s) consisting of computation of income and audit report. We have also gone through the documentary evidences furnished in all cases. Ground No.1 in assessee's appeal relates to the validity of reopening. The ld AR for the assessee vehemently argued that the AO reopened the case of the assessee on the basis of third party information, and without making any preliminary investigation, which was vague about the alleged accommodation entry by Bhanwarlal Jain Group. And that there was no specific information about the accommodation entry availed by the assessee. There is no live link between the reasons recorded qua the assessee. We find that the assessee has raised objection against the validity of the reopening before the AO. The objections of the assessee was duly disposed b....
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....a dealers/ entry provider namely Bhanwarlal Jain. We find that the AO while making additions of 100%, of disputed purchases solely relied on the report of the investigation wing Mumbai. No independent investigation was carried by the AO. The AO has not disputed the sale of the assessee. The AO made no comment on the evidences furnished by the assessee. We further find that ld CIT(A), while considering the submissions of the assessee accepted the lapses on the part of the AO and noted that no sale is possible in absence of purchases. The Books of the assessee was not rejected by the AO. The ld CIT(A) on further examination of the facts and various legal submissions find that Ahmedabad Tribunal in Bholanath Poly Fab Private Limited (supra) held that in the such cases the addition of bogus purchases was sustained to the extent of 12%, on the observation that the assessee may have made purchases from elsewhere and obtained the bills from impugned supplier to inflate Gross Profit Rate. The ld CIT(A) by considering the overall facts, concluded that the 100% disallowance of purchase is not justified. We also find that the ld.CIT(A) also considered the decision of jurisdictional High Court....
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....ed the GP @ 0.78%. It is settled law that under Income-tax, the tax authorities are not entitled to tax the entire transaction, but only the income component of the disputed transaction, to prevent the possibility of revenue leakage. Therefore, considering overall facts and circumstances of the present case, we are of the view that disallowances @ 6% of impugned purchases/disputed purchases would be sufficient to meet the possibility of revenue leakage. In the result the ground No. 2 of appeal raised by the assessee is partly allowed and the grounds of appeal raised by revenue are dismissed. 22. In the result the appeal of revenue is dismissed and the appeal of the assessee is partly allowed." 8. These appeals filed by the Revenue and Assessee, relate to Bhanwarlal Jain ground cases. The Assessing Officer made 100% addition of bogus purchases. On appeal by assessee, Ld. CIT(A) restricted the addition to 5% of bogus purchases by following the judgment of Hon'ble Gujarat High Court in the case of M/s Mayank Diamond Pvt. Ltd. (2014) (11) TMI 812 (Guj.). 9. The Ld. DR for the Revenue argued before us that assessee was engaged in taking bogus purchase bills/accommodation entry....
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....ssessing officer. 15. We have heard both the parties. Having gone through the entire gamut of facts and circumstances, we are of the view that not only there existed new information with the AO from the credible sources, but also that he has applied has mind and recorded the conclusion that the purchases claimed were non-genuine/mere accommodation entry on bogus purchases, and therefore bogus, (clearly meaning that what was disclosed was false and untruthful). The Hon'ble Supreme Court in the case of Phul Chand BajrangLal and another vs. ITO 203 ITR 456, was considering the question of reassessment beyond the period of four years in the case of an assessee firm; and had held that in case of acquiring fresh information specific in nature and reliable, relating to the concluded assessment, which went to falsify the statement made by the assessee at the time of original assessment and, therefore, he would be permitted under the law to draw fresh inference from such facts and material. The Court also went to an extent of saying that there are two distinct and different situations where the transaction itself, on the basis of subsequent information is found to be bogus transaction ....