TaxTMI 
TaxTMI 
2026 (10) TMI 533
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....ia) Ltd. reported in 172 Taxmann.com 283. b. It is submitted that present appeal may be filed in accordance with the CBDT's Circular No.5/2024 dated 15.03.2024 as per Para 3.1(c) of the said Circular. The Order of the CIT(A) may kindly be vacated and the matter may be set-aside to the file of the AO for fresh assessment. c. The appellant craves leave to add, amend or alter any ground/grounds, which may be necessary." Cross Objection filed by the assessee: "1. In the facts and circumstances of the case and in law, the Assessing Officer erred in issuing Notice u/s 148: a) only on the basis of information received from investigation wing and without making any enquiry which is against the judgement of Shodiman Investments (P.) Ltd (422 ITR 337 Bombay High court.) b) No reopening can be made as was held in the case of Odeon Builders. 2. In the facts and circumstances of the case and in law, the JAO erred in reopening the case which was required to be reopened by FAO as per the judgement of Bombay High Court in the case of 464 ITR 430 (Bombay) Hexaware Technologies Ltd. vs. ITO. 3. In the facts and circumstances of the ca....
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....d concern remained uncomplied with and the verification conducted at its stated address revealed that some other entity was occupying the premises. The Ld. AO, thus, treated the entire purchases of Rs. 35,41,340/- as unexplained expenditure u/s 69C of the Act and brought the same to tax in terms of section 115BBE. Aggrieved by the order of the Ld.AO, the assessee preferred appeal before the Ld.CIT(A). 3. The Ld.CIT(A), on considering the material placed by the assessee, observed that though the genuineness of the supplier remained doubtful, the corresponding sales had not been disputed. The Ld.CIT(A), was of the opinion that the entire purchases could not be brought to tax u/s 69C and restricted the addition to the profit element embedded in such purchases estimated at 12% of Rs. 35,41,340/-. The Ld.CIT(A) accordingly partly allowed the assessee's appeal on this issue. Aggrieved by the order of the Ld.CIT(A), the assessee is in appeal before this Tribunal. 4. Cross Objection by the assessee 4.1 The assessee, in the Cross Objection, challenged the reopening of assessment as well as the estimation of profit at 12%. It is contended that, the reopening was merely on ....
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....exaware Technologies Ltd. (supra). Reliance was also placed on the decision of the Coordinate Bench in Arham Star v. ITO [2025] 180 taxmann.com 44 (Mumbai-Trib.) was also brought to our notice. We have perused the submissions advanced by both sides in light of the record placed before us. 6. We first take up Grounds 1 and 2 raised in the Cross Objection challenging the validity of the reassessment proceedings. 6.1. Insofar as the reliance on Shodiman Investments (P.) Ltd. (supra) is concerned, we note that the said decision was rendered in the context of the erstwhile reassessment regime requiring formation of "reason to believe". In the present case, proceedings have been initiated under the reassessment regime substituted with effect from 01/04/2021. The material available with the Ld. AO contained specific information identifying the assessee, the alleged supplier, namely M/s Moksh Alloy Pvt. Ltd., and the amount of purchases of Rs. 35,41,340/-. Notice u/s 148A(b) was issued to the assessee before passing the order u/s 148A(d). It is also an undisputed position emerging from the record that the assessee did not furnish any response at the stage of proceedings u/s 148A. ....
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....assessee furnished details correlating the purchases with subsequent sales. Importantly, the sales declared by the assessee have not been disturbed. 7.1. At the same time, the material collected by the Revenue concerning M/s Moksh Alloy Pvt. Ltd. cannot altogether be ignored. The said concern was found to be connected with the information received from the GST authorities relating to issuance of accommodation bills; notice issued u/s 133(6) remained uncomplied with; and physical verification at the stated address also did not establish the existence of the supplier. Thus, though the purchase of goods as such cannot be discarded when corresponding sales stand accepted, the assessee has not satisfactorily established the purchases from the very party appearing in the books. 7.2. The Hon'ble Bombay High Court in case of PCIT v. Mohammad Haji Adam & Co. (supra) held that, in case of a trader where corresponding sales are not disputed, the entire purchase cannot be brought to tax and the addition has to be confined to the profit element embedded in such purchases. We have also considered the decision in PCIT v. Kanak Impex (India) Ltd. [2025] 172 taxmann.com 283 (Bom.), relied upo....