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TMI Blog2015 (6) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... ed for by the Assessing Officer were furnished; the books of account were audited by a firm of Chartered Accountants and their report was unqualified, full quantity tally of raw-material, finished goods etc. was maintained; the total turnover declared for the year has been accepted as correct by the Assessing Officer; complete books of account and vouchers for purchases, sales and expenses were maintained; the purchases were made from the dealers registered with the sales-tax department and they were paid for by account payee cheques and the appellant’s bank account corroborated this, etc. In absence of conduction of its independent investigation by the Assessing Officer in the matters, as directed by the ITAT, we are thus of the view that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in law, the Learned CIT(Appeals) has erred in deleting the addition of ₹ 19,88,487 made on account of modvat to be reserved for bogus purchases. 4.1The Learned CIT(Appeals) ignored the finding recorded by the A.O. and the fact that the assessee did not file the requisite evidence during the course of reassessment proceedings despite having been provided with ample opportunities. 2. Heard and considered the arguments advanced by the parties in view of orders of the authorities below, material available on record and the decisions relied upon. 3. Ground No.1 is general in nature, hence, does not need independent adjudication. 4. Ground Nos. 2, 2.1, 3, 3.1,4 and 4.1 : The basic facts are that the assessee company is engaged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on bogus purchases. . 16. We have carefully considered the entire material on record and the rival submissions. On going through the order of the Assessing Officer, it is found that he has not examined the material collected during survey conducted by the Income-tax Department. Similarly the Assessing Officer has himself not made independent inquiry and mostly placed reliance on the material unearthed by the Central Excide Department or the material ascertained from the Settlement Commission. So far as the proceedings before the Settlement Commission are concerned, they related to assessment years 1995-96 and 1996-97 and not to assessment year 1997-98. Therefore, the material relevant to assessment year 1997-98 was not submitted b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Assessing Officer to decide it afresh after examining the entire relevant material in the light of observations as made above. While doing so, the Assessing Officer shall given due opportunity of being heard to the assessee. 6. In compliance of the order of the ITAT, reproduced hereinabove, the Assessing Officer has repeated the same additions which have been deleted by the Learned CIT(Appeals). Against this action of the Learned CIT(Appeals), the Revenue is in appeal before the ITAT. 7. In support of the grounds, the learned Sr. DR referred the assessment order in support of his contentions that despite adequate opportunity, the assessee did not bother to furnish the required details, books of account along with supported bill ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... noted by the Assessing Officer that the details as well as books of account were produced and examined on testcheck- basis. The Learned AR submitted further that while making the assessment in compliance of the order of the ITAT afresh, the Assessing Officer has passed the order in haste within 20 days without carrying out any independent investigation. 9. Having gone through the orders of the authorities below, order of the ITAT and material available on record, we find substance in the grievance of the assessee that the Assessing Officer has not made any independent verification of the relevant material in the light of the observations made by the ITAT. The ITAT had noted that the Assessing Officer while passing the order under sec. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excess stock then survey would have been converted into search by the Income-tax Department which did not happen. The Income-tax Department did not find any irregularity in stock. Hence addition made by the A.O. on the findings of Central Excise Department is totally illegal. There was also neither shortage of finished goods nor shortage of raw material on the date of search or even during the year under consideration. Had there been any shortage of finished goods or raw material then profit on the short goods would have been the income of the company instead of whole amount of shortage. We wish to submit that the appellant company has declared bogus creditors of ₹ 1,30,21,922 before the Hon ble Settlement Commission and during ..... X X X X Extracts X X X X X X X X Extracts X X X X
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