AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (7) TMI 1581
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.... the same are disposed by this common order for the sake of convenience. 2. The brief facts of the case are the assessee (Late Faridmiya Hussenmiya Shaikh) was a proprietor of M/s. Sojas Corporation, engaged in the business of wholesale trading of tobacco products and received income from house property and income from other sources. For the asst. year 2020-21 the assessee filed his original Return of Income u/s. 139(1) of the Act on 16.12.2020 declaring total income of Rs. 44,19,940/-. The assessee died on 06-05-2021 and is represented by his wife as the Legal representative. There was a search action u/s. 132 of the Act carried out in the case of MHS group on 16.11.2021 and the key person of MHS group is Shri Mustufamiyan Hussenmiyan Shaikh. The group was the main distributor of Manekchand Gutkha (RMD) in Gujarat Circle and carried on the business of Manekchand Gutkha on wholesale basis. During the search and seizure action, the office premises of the assessee was also covered u/s. 132 of the Act. Therefore, in the light of incriminating documents seized, satisfaction was drawn as per provisions of the Act and notice u/s. 148 of the Act was issued on 24-07-2023. 2.1. In res....
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....reply and contended that in pursuance of statements of Shri Mayank Ashokhbhai Khatri, Shri Rashminbhai Majithia in his statement recorded u/s. 131 of the Act, had not only categorically disowned such documents i.e. page Nos. 156 to 159 and denied having any connection with financial transaction with the above stated entities from entire Zen Group of concerns, but also asserted and affirmed that they have not made any cash sales to Shri Mustufamiya Hussainmiya Shaikh, M/s. Sojas Corporation, M/s. Manali Sales Agency and M/s. Modern Sales Agency. Not only that but he has further affirmed that the papers are not related to his group and also that they do not have any practice to write figures in abbreviated code by omitting four zeroes (0000) in reply to question on referred pages nos. 156 to 159. 2.4. However, the Ld. AO had not accepted the plea of the assessee and rejected books of accounts of the assessee u/s. 145(3) of the Act and made addition on account of estimated difference in GP while passing the assessment order. The working investment in unaccounted purchase are as under: Particulars F.Y. 2019-20 (in Rs.) F.Y. 2020-21 (in Rs.) F.Y. 2021-22 (in Rs.) Total....
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....Estimation of Gross Profit of protective basis. 2021-22 31/12/2022 29,99,100/- 3,68,17,899/- 5,92,40,000/- 1. On account of unaccounted receipt u/s. 68 of the Act. 2. On account of unaccounted/unexplained investment in Stock u/s. 69 of the(Rs.2,21.10,849/- on a substantive basis & Rs. 1,47,07,050/- on protective basis.) 3. On account of Estimation of Gross Profit 2022-23 12/02/2024 5,60,400/- 1,29,35,323/- 62,89,412/- 1. On account of unaccounted receipt u/s. 69A of the Act. 2. On account of unaccounted/unexplained investment in Stock u/s. 69 of the(Rs.1,21,51,482/- on a substantive basis & Rs. 7,83,841/- on protective basis.) 3. On account of Estimation of Gross Profit of protective basis. (as per 7) 3. Aggrieved against the assessment orders assessee filed appeals before Ld CIT[A], who deleted the alleged unaccounted purchases made by the assessee from M/s. Zen Industries Ltd since the alleged sales made by M/s. Zen Industries Ltd were already deleted by Ld CIT[A] vide his common order dated 03-02- 2025 and corresponding alleged purchases made by the assessee were deleted and also estimation of gross profit by observing as follow....
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....nvalid as passed without assuming a valid jurisdiction and also that of the Ld. CIT(A) inasmuch as that the relevant ground of appeals no. 1 & 2 as raised before him are summarily dismissed without narrating the grounds of decision, besides committing factual error of having not considered the arguments made in person by the authorized representative by observing as having not represented by the AR at all, as such having being passed arbitrarily. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) has further erred in dismissing the legal grounds no.1 & 2 of the appeal filed before him challenging the impugned assessment order so passed by the A.O. being in violation of set procedure of law and thus being void ab initio. 3 On the facts and circumstances of the case and in law, the Ld. CITA) has further erred in denying Justice, without any justification and thereby further erred in sustaining addition of Rs. 37,29,300/- representing unexplained receipt u/s 69A of the Act so made by the A.O. 5. Heard rival submissions at length and perused the materials available on record including the Paper Book and Case Laws relied by the assessee. First ....
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....that the assessee has regular transactions of purchases from Zen Group and all the transactions of sales and purchase have been duly Mayank Khatri which was not even verifiable from the evidences produced by the Assessee. The Assessing Officer has not established the nexus of cash sale to the Zen Group to the assessee concern. The CIT(A) in para 4.4 categorically mentioned that there was no evidence related to unrecorded payment made in cash to Zen Group of concern which was found during the course of search action. Besides this, neither the purchase party i.e. the assessee or his family members nor the seller party i.e. Shri Rashminbhai M. Majithia, Director of M/s Zen Tobacco Pvt. Ltd. & M/s Zen Industries Pvt. Ltd. had admitted in the statement recorded during the course of search action or post search action that the said seized page no. 156 to 159 was related to the assessee or his group concern regarding unaccounted purchase of tobacco or other products. Therefore, the CIT(A) as rightly held that the addition made on account of initial investment in unaccounted stock and estimation of GP does not survive. There is no need to interfere with the findings of the CIT(A). Thus, IT....
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....cordingly, holding the unaccounted purchase in the hands of MHS Group, added Rs. 11,16,31,500/- & Rs. 5,92,40,000/- on account of estimation of GP and Rs. 59,08,859/- & Rs. 1,47,07,050/- as unaccounted/unexplained investment in stock for the assessment years 2020-21 & 2021-22 respectively. My predecessor CIT (A) while adjudicating the appeals of the alleged purchaser on the basis of the seized page nos. 156 to 159 in the case of Mustufamiyan Hussenmiyan Shaikh (MHS) group in Appeal no: CIT (A) Ahmedabad-11/10688/2019-20, Dated 29.08.2024 held in favour of Mustufamiyan Hussenmiyan Shaikh (MHS) group, the alleged purchaser by deleting the entire additions. The findings of the Ld.CIT(A) as per the concluding para (Para no 4.6) of the order is as under: "Keeping in view of the contentions as discussed supra and record available, it can be concluded that the AO had not brought any record which suggests that the said seized pages were related belonging/pertaining to unaccounted purchase made by M's Mustafa Sales Agency (Prop: Mustufamiyan H Shaikh) & Sojas Corporation group as there is no vital details 1.0. name of the appellant, quantity of product item, description of item....