TaxTMI 
TaxTMI 
2020 (12) TMI 1423
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....f facts are, the assessee, an individual, claims to be engaged in the business of manufacturing and trading in precious and semi- precious stones and jewelry through his proprietary concern Sangam Exports. For the assessment year under dispute, the assessee filed his return of income on 29th September 2009, declaring income of Rs.9,26,480. In consequence of a search and seizure operation conducted under section 132 of the Act in case of Rajat Pharma, a survey action under section 133A of the Act was carried out in the business premises of the assessee on 12th December 2008. During such survey proceedings, the assessee, as stated by the Assessing Officer in the original assessment order, confessed of having only provided accommodation entrie....
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....147 of the Act. Since, assessee's assessment jurisdiction subsequently was transferred to Mumbai, the Assessing Officer, Central Circle-7(3), Mumbai, also re-opened the assessment under section 47 of the Act on the basis of very same information. However, the Assessing Officer, Circle-2, Ajmer, completed the assessment first vide order dated 27th March 2015, adding back the entire purchases of Rs. 5,04,94,046, to the income of the assessee. Subsequently, the Assessing Officer, Central Circle-7(3), Mumbai, relying upon the very same information received from the Sales Tax Department, concluded that though in the original assessment order passed under section 143(3) of the Act, the Assessing Officer has computed the commission income on sales....
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....d, once the purchases and sales turnover have been held as bogus and commission income has been estimated, the re-opening of assessment cannot be made under section 147 of the Act, again on the allegation that the purchases are bogus. Further, he submitted, on the basis of very same information received from the Sales Tax Department, Government of Maharashtra, the Assessing Officer at Ajmer had re-opened and completed the assessment by treating the entire purchases from three parties as bogus and adding them back to the income of the assessee. Therefore, any further action under section 147 of the Act on the basis of very same information is untenable. The learned Counsel for the assessee submitted, when assessee's purchases and sales have ....
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....that the assessee was actually not carrying out any purchase or sales transactions and was merely providing accommodation entries. In the statement record during the survey operation, the assessee also admitted the aforesaid factual position. Thus, while completing the assessment originally the Assessing Officer treated the entire purchase and sales transaction by the assessee as bogus and estimated commission income on the sales turnover shown by the assessee. As could be seen, after completion of the original assessment, the Department received information from the Sales Tax Department, through the DGIT (Inv.), Mumbai, revealing that purchases worth Rs. 5.04.00.000, claimed to have been made from three parties are non genuine. On the basi....