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TMI Blog2015 (7) TMI 318X X X X Extracts X X X X X X X X Extracts X X X X ..... scaped assessment. Moreover, as stated above, the assessee had not raised any objection relating to reopening of the assessment during the assessment proceedings. We, therefore do not find any infirmity in the order of the Ld. CIT(A) in upholding the action of the AO for reopening of the assessment under section 147 of the Act. - Decided against assessee. Addition on bogus purchases - Held that:- Solely on the basis of unconfronted and general statements of alleged suppliers made before sales tax authorities, purchases of the assessee can not be held to be bogus. We find that the contention of the assessee that the payments for the purchases were made by cheque which was further confirmed by bank statement of the parties, bills of the transporter supported with proof of payment by way of bank statement, quantitative details of the stock, corresponding sales made, increase in sales, gross profits and net profits and there being no incriminating material or discrepancy in stock found at the time of survey have not been examined by the AO. The matter is therefore restored to the file of the AO for the purpose of verification of the above documents and if the above contentions of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellate order, have left some columns blank, did not mention the name of the broker, and the bills were issued in a chronological order, and without asking Ali Steels why these columns have been left blank. vii. Without considering that the assessee had produced all necessary details such as Ledger accounts, copies of purchase bills, copies of bank statements of Union Bank of India evidencing payments to these parties, copy of bills of the transporter Manoj Transport along with bank statement, monthly quantitative statements and inventory of closing stock. viii. Merely because there is no mention of stock register in the Tax Audit Report ignoring that quantitative details of stocks was given in the Tax Audit Report as well as in the notes to the audited financial statements and all the basic details that go into the stock register were submitted in the to the AO, as mentioned in para 4.1 of the appellate order. ix. although the sales made from these purchases were accepted by the AO along with the profit declared thereon. x. without even attempting to discuss the judgments of different Courts and Tribunals that the assessee relied upon. 3. A perusal of the abov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act. Thereafter, a notice under section 142(1) was issued to the assessee to furnish the required details. In this case, a specific information was received by the Income Tax Authorities that certain parties were engaged in issuing bogus bills for the supply of material. During the survey action, the assessee was found to have made purchases from the said parties. There were certain discrepancies noted by the AO in the bills. The AO therefore, had reasons to believe that the income of the assessee relating to the purchases made from the above three parties had escaped assessment. Moreover, as stated above, the assessee had not raised any objection relating to reopening of the assessment during the assessment proceedings. We, therefore do not find any infirmity in the order of the Ld. CIT(A) in upholding the action of the AO for reopening of the assessment under section 147 of the Act. This issue is accordingly decided against the assessee. 6. The second issue is relating to the addition made in the hands of the assessee on account of bogus purchases. During the assessment proceedings under section 147 of the Act, the assessee provided evidences to prove the genuineness of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of bills of transporter along with bank statement, monthly quantitative statements and inventory of closing stock. The Ld. A.R. has further submitted that the quantitative details of the stocks were given in the audit report as well as in the notes to the audited financial statement and therefore all the basic details that go into the stock register were duly submitted before the AO. He has further contended that even the sales made from these purchases and the profit thereupon was accepted by the AO. He has also relied upon the decision of the Hon'ble Bombay High Court in the case of CIT v. M/s. Nikunj Eximp Enterprises Pvt. Ltd. ITA No.5604 of 2010 decided on 17.12.2012 and further of the Hon'ble Calcutta High Court in the case of Diagnostics v. CIT (2012) 20 taxmann.com 692 (Cal.). The Ld. D.R. on the other hand, has relied upon the findings of the lower authorities. 9. We have considered the rival submissions. We find that the additions in this case have been made on the ground of information received from investigation wing that certain parties had been indulging in bogus billing. However, the assessee has contended that during the survey action conducted at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d and general statements of alleged suppliers made before sales tax authorities, purchases of the assessee can not be held to be bogus. We find that the contention of the assessee that the payments for the purchases were made by cheque which was further confirmed by bank statement of the parties, bills of the transporter supported with proof of payment by way of bank statement, quantitative details of the stock, corresponding sales made, increase in sales, gross profits and net profits and there being no incriminating material or discrepancy in stock found at the time of survey have not been examined by the AO. The matter is therefore restored to the file of the AO for the purpose of verification of the above documents and if the above contentions of the assessee are found to be correct from the evidences submitted, the additions in this case on account of bogus purchases will not be warranted. Needless to say that AO will give proper opportunity to the assessee to present its case. ITA No.6092/M/2014 for A.Y. 2009-10 11. In the appeal, the assessee has agitated the addition of ₹ 4,31,48,505/- on account of bogus purchases made from the three parties as mentioned above. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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