TaxTMI 
TaxTMI 
2026 (7) TMI 1687
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....delay. Considering the reasons cited before us to be bonafide and genuine, we are inclined to condone the delay and admit the appeal for hearing. 3. The Revenue has challenged the order of ld. CIT (A) deleting the addition of Rs.9,49,08,558/- as made by the ld. AO u/s 69C of the Income-tax Act, 1961 (hereinafter referred to as "the Act") as unexplained cash credit in respect of bogus purchases. 4. At the outset, the counsel of the assessee brought to our notice that the Cross Appeal in this case filed by the assessee in ITA No. 1642/KOL/2024 for A.Y. 2018-19, and submitted that the same has been disposed off by the co-ordinate Bench vide order dated 20.12.2024 and others, wherein while disposing of the grounds no.1 to 4, in which the assessee raised the legal issues of validity of assessment proceedings issued, was decided in favour of the assessee by quashing the reassessment proceedings as well as the consequent order passed. The ld. AR therefore prayed that the appeal by the Revenue become infructuous and may kindly be dismissed. 5. The DR on the other hand submitted that admittedly the cross appeal by the assessee as stated above by the ld. AR has been disposed off whe....
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....cial substance and not for bonafidepurposes'. This finding is clearly well beyond what is contained in the notice issued under Section 148A(b) and could not have been rendered without giving the petitioners adequate opportunity to rebut the assertion. In fact, coming to a definitive conclusion that there is avoidance of tax liability through independent verification but not disclosing the reasons or materials based on which such findings could be rendered and without giving an opportunity to the petitioners to put their case clearly. Thus, there is a gross violation of the principles of natural justice. (iv) It hardly needs to be stated that the order to be passed under Section 148A(d) cannot transcend the scope of proposal notice under Section 148A(b) inasmuch as such a notice happens to be the foundation on the basis of which such an order can be passed, and not otherwise. That is how the statutory scheme is devised. Definitive conclusions as to grounds that are not indicated in the proposal notice cannot be said to be in line with the scheme and purpose of Section 148A. This apart, non-consideration of the reply relating to Section 56 and Section 47 would make the order....
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....e used in the order itself.' Referring to said decision, Krishna Iyer J., in MOHINDER GILL supra, has wittily observed: 'Orders are not like old wine becoming better as they grow older. "(I) AS TO WHETHER MATTER MERITS REMAND OR CLOSURE HERE ITSELF: (i) Both the sides having argued at length have also filed the Written Submissions touching merits of the matter that would belong to the domain of Assessing Officer. There is no need for this court to undertake a deeper examination of the aspects argued at the Bar namely whether the transactions in question amounted to transfer at all in view of section 47(vid) of the 1961 Act which enacts a fiction as to what is not a 'transfer' which otherwise in common parlance would have amounted to. Similarly, it was also debated at the Bar that as to whether the transactions in question were chargeable to income tax under the head 'income from other sources' under section 56(2). In addition, it was also fiercely argued as to whether the subject transactions amounted to short term or long term capital gains. (ii) All the above aspects do not merit consideration in view of this court specifically faltering the impugned no....
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....ompanies Act, 2013, under the Income Tax Act and under cost audit framework and also under VAT and GST laws and no adverse interference was drawn by the auditors. The assessee also filed before the ld. AO the books of accounts, the copies of accounts in the suppliers, records relating to the assessee tax invoices, e-way bills, lorry receipts, weighment slips and photographs of the delivery vehicle taken at the factory gate, GST registration certificate, GSTR-1 & GSTR-3B returns filed by the suppliers and trade licenses and professional tax registrations of the suppliers. The ld. AO also issued notices u/s 133(6) of the Act to these suppliers which were also duly served on the suppliers who also confirmed the transactions with the assessee by furnishing all the details and evidences qua the sales made to the assessee. However, the ld. AO relied heavily on the deposition of the assessee taken during the course of search that assessee has taken bogus bills from the parties other than the parties from whom the purchases were made in the regular course of business. The ld. AO noted that the assessee has already offered a GP rate of 2.99% and also stated the correctness and completeness ....
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....en maintaining the regular books of accounts and including the purchase register, sale register, stock register, production records. The assessee is a manufacturing company maintaining regular books of account, including purchase register, sales register, stock register and production records. Financial statements are prepared in compliance with the Accounting Standards notified under the Companies Act, 2013, and the method of accounting has remained unchanged. The books of account were audited under (1) the Companies Act, 2013, (ii) section 44AB of the Income-tax Act, 1961, (ii) the Cost Audit framework, and (iv) the VAT/GST laws, and there is no adverse observation in any of these audit reports. 11.2. We note that during the assessment proceedings, the assessee filed, inter alia, the Audit Report, Tax Audit Report, Cost Audit Report, party-wise details of trade receivables, trade payables, purchases and sales, and a comparative chart of Gross Profit and Net Profit ratios for FY 2016-17 to FY 2020-21, reproduced below: Financial Year Assessment Year Gross Profit (%) Net Profit (%) 2016-17 2017-18 3.52 0.99 2017-18 2018-19 3.35 0.82 2018-19....