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TMI Blog2016 (11) TMI 539X X X X Extracts X X X X X X X X Extracts X X X X ..... custom clearance will not prove physical delivery of the material (precious stones). There is nothing on record to certify the stones which were verified by any of the valuer. In our view it is all paper transactions for the purpose of taking benefit of the export and tax benefits. Thus as it is a bogus purchase the finding which has been arrived by the Tribunal is not in consonance with the provisions of law - Decided in favour of revenue - D. B. Income Tax Appeal No. 305/2008 - - - Dated:- 2-11-2016 - K. S. Jhaveri And Mr. Mahendra Maheshwari, JJ. Mr. Nikhil Simlote, for Mr. R.B. Mathur, for appellant None present, for respondent ORDER By The Court ( Per Hon'ble Jhaveri, J. ) 1. By way of this appeal, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urchases from above parties were established to be bogus after making in depth enquiries by the AO. During the course of assessment the AO has recorded Statements of concerned parties were established to be bogus after making in depth enquiries by the AO. During the course of assessment proceeding it has been gathered that the assessee has failed to produce the owners of the two concerns. The reasons like non- availability of the said two suppliers at the given addresses, non production of two suppliers by the assessee in spite of various opportunities granted, statement of Sh. Mohan Prakash Sharma Power of Attorney holder of M/s Vinayak Overseas stating of giving accommodation entireties only and nature and volume of transaction appearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferent dates and it was found that either the files do not exist as per details given by the assessee or the records do not tally with the facts mentioned by the assessee, except in two cases where the records were available in respect of Moolchand Chhabra and Somani Supply Syndicate Company and in all other cases creditors were not even found at the addresses given by the appellant. Apart from having enquiries made by the inspectors several letters were also issued to the assessee between January 16, 1982, and February 24, 1986, bringing to its notice that the loans could not be verified and adequate proof is required. At no stage have the appellant's representatives responded properly. Nowhere was the question of checking up the bank ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me Tax, in DB Income Tax Appeal No. 129/2015 decided on 6th May, 2016 wherein paragraph 22 and 23 read as under: 22. In the case of Commissioner of Income Tax, Orissa Vs. Orissa Corporation (P) Ltd. (supra), the facts noticed by the Apex Court were that the assessee has given names and addresses of the alleged creditors, it was in the notice of the Revenue that the said creditors were income tax assessees, their index number was in the file of the Revenue, still the Revenue apart from issuing notices under Section 131 at the instance of the assessee did not pursue the matter further. The Revenue did not examine the source of income of the said alleged creditors to find out whether they were credit worthy or were such who could advance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) were on account of applying abnormal gross profit rate and this court found that abnormal fanciful additions cannot be made and assessees own results of the previous year were required to be looked into whereas the present case is entirely distinguishable and the AO has not touched upon the gross profit rate rather has held the very purchases doubtful and nonverifiable which fact is now apparent and as discussed 15 hereinbefore. Thus these judgments are distinguishable. 5.1 He also relied on Commissioner Of Income-Tax vs M/S. La Medica, Delhi, 250 ITR 575 wherein it has been held as under:- The fact that the alleged sellers have been found to be persons with no means to effect purchases or to carry on business is a factor which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he contrary it has been established by materials on record that assessed knew that the whole thing was a fictitious arrangement. Once it is accepted that the supplies were not made by Kalpana Enterprises to whom payments were alleged to have been made, the question whether the purchases were made from some other source ougth not to have weighed with the Tribunal as a factor in favor of the assessed. The conclusions of the Tribunal are, therefore, clearly erroneous, contrary to materials on record and have been arrived at without taking into consideration relevant material and placing reliance on irrelevant materials. It is to be noted that assessed's stand was not that it had effected purchases from anybody else. Its stand throughout wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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