TaxTMI 
TaxTMI 
2026 (10) TMI 37
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.... his return of income for AY 2020-21 on 22.12.2020 declaring total income of Rs. 4,86,570/-. Subsequently, information was received through the INSIGHT portal based on CRIU/VRU data indicating that the assessee had allegedly entered into transactions of purchases amounting to Rs. 50,96,555/- from M/s Gauri Shankar Trading Co., which was suspected to be a non-genuine entity involved in providing accommodation entries. Accordingly, proceedings u/s. 148A of the Income-tax Act, 1961 (for short 'the Act') were initiated. A show cause notice u/s. 148A(b) dated 15.02.2024 was issued to the assessee asking to explain as to why the said transactions should not be treated as income escaping assessment. The assessee furnished a reply on 07.03.2024, wh....
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....x returns despite substantial GST transactions. 5. The Assessing Officer further observed that the assessee failed to substantiate the genuineness of the purchases by furnishing supporting evidences, such as, purchase invoices, transportation details, e-way bills, delivery challans, stock registers and proof of payment. It was also noted that no payment was found to have been made to the said party and that the pattern of transactions appeared to be structured in a manner to avoid regulatory checks. In view of these facts, the Assessing Officer concluded that the assessee failed to establish the identity, creditworthiness and genuineness of the transactions. Accordingly, the Assessing Officer treated the purchases as non-genuine and made....
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....llowance of the purchases instead of restricting the addition to the gross profit element embedded therein. 6. The Ld. CIT(A) erred in confirming the addition of Rs. 16,146 under Income from Other Sources, failing to appreciate that this was a bona fide correction made in the return filed u/s 148 and was never part of the reasons recorded for reopening. 7. The Appellant craves leave to add, alter, amend, substitute, OR withdraw any OR all Grounds of Appeal before OR at the time of hearing. 8. The Ld. CIT(A) erred in law and on facts in upholding the reassessment proceedings initiated and concluded by the jurisdictional Assessing Officer (JAO) instead of the Faceless Assessing Officer (FAO), rendering the order voi....
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....the Assessing Officer has disallowed the entire amount of Rs. 60,13,941, which includes GST component of Rs. 9,17,386, whereas the actual purchases debited to the Profit & Loss Account amount to Rs. 50,96,555 only. He submitted that the GST charged by the supplier is a statutory levy collected on behalf of the Government and does not constitute income or expenditure of the appellant, nor is it retained by the appellant, accordingly, inclusion of such GST component in the alleged non-genuine purchases is wholly impermissible in law, and the addition to the extent of GST is liable to be deleted on this ground alone. He submitted that the Assessing Officer has accepted the sales declared by the assessee and has not disturbed the trading result....
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....rces as compared to the original return of income. We observed that the Assessing Officer has accepted the sales declared by the assessee and has not disturbed the trading results. We further observed that there cannot be any sales without purchases. Further, we observed that Assessing Officer treated the whole purchases as non-genuine, invoking the provisions of section 69C of the Act, making 100% disallowance, including the GST component therein. We further observed that with regard to that the purchases are genuine, assessee filed documentary evidences, such as, invoices, GST returns, stock records, etc. However, Assessing Officer observed that the assessee failed to furnish critical supporting evidences such as transport documents, e-wa....