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TMI Blog2017 (5) TMI 1368X X X X Extracts X X X X X X X X Extracts X X X X ..... nancial Year 2004-05. We do not find any infirmity in the findings of Commissioner of Income Tax (Appeals) in deleting the addition. - Decided against revenue - ITA No. 488/PUN/2015 - - - Dated:- 26-5-2017 - SHRI D. KARUNAKARA RAO, AM AND SHRI VIKAS AWASTHY, JM For The Assessee : Shri Nikhil Pathak For The Revenue : Shri Alok Malviya ORDER PER VIKAS AWASTHY, JM : This appeal by the Department is directed against the order of Commissioner of Income Tax (Appeals)-12, Pune dated 27-01-2015 for the assessment year 2005-06. 3. The facts of the case as emanating from records are: A search action u/s. 132 of the Income Tax Act, 1961 (hereinafter referred to as the Act ) was carried out at the premises of Fabtech Pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al return of income for assessment year 2005-06). Thus, the Assessing Officer made addition of amount short declared by the assessee i.e. ₹ 1,14,45,953/-. Aggrieved by the assessment order dated 15-03-2013 passed u/s. 143(3) r.w.s. 148 of the Act, the assessee filed appeal before the Commissioner of Income Tax (Appeals). Before the First Appellate Authority, the assessee explained that total bogus purchases declared by the assessee during the course of search proceedings ₹ 3,95,50,291/- included opening balance of ₹ 1,45,68,748/- as on 01-04-2004. Thus, for the assessment year 2005-06 only bogus purchases debited during the financial year 2004-05 could be added. The Commissioner of Income Tax (Appeals) accepted the cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed bogus purchases to the tune of ₹ 3,95,50,291/- for the period relevant to the assessment year 2005-06. The ld. AR referred to the copy of letter dated 28-03-2012 submitted to the Income Tax Officer (Inv.), Unit-II, Pune at page 12 of the paper book. The ld. AR submitted that a perusal of letter clearly shows that the assessee had declared total amount of ₹ 10,22,42,765/- which included the opening balances of the financial year 2004-05. The ld. AR referred to the Annexure I at page 13 of the paper book. The ld. AR pointed that a perusal of chart shows that for the Financial Year 2004-05 a bifurcation is given wherein opening balances as on 01-04-2004 in respect of Shree Sai Industries ₹ 42,73,486/- and Sohan Metal Pvt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 01-04-2004. Bogus purchases for Financial Year 2003-04 cannot be added in subsequent financial year. 7. The Commissioner of Income Tax (Appeals) has deleted the addition by observing as under : 2.1.6 I have carefully considered the facts and have gone through the assessment order. I find that the Appellant has declared lower additional income in the return of income than what was admitted at the time of search because of the following two reasons: 1) Appellant has reduced the declared amount of additional income by the opening balance with the above two parties because the opening balance pertained to the bogus purchases made in the previous year. 2) It has declared reduced amount of the additional income after verif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... represented bogus purchases made during the previous year, the same cannot be added during the year. Further, the Appellant has offered correct amount of the additional income based on the bogus purchases made from these parties during the year. It may be seen that the total amount of the bogus purchases were made from the parties during the year under consideration was of ₹ 2,49,81,843, as against it, the Appellant has offered additional income of ₹ 2,81,04,338. In other words although the Appellant's total opening balance with the above parties is of ₹ 1,45,68,748/- however, the Appellant seeks benefit of the lower amount of ₹ 1,14,45,952. The break-up of additional income of ₹ 2,81,04,339 declared by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thout carrying out any inquiries or verifications and proving the Appellant's contention incorrect cannot be sustained. Therefore, I delete the addition of ₹ 1,14,45,953 made by the learned AO. 8. The ld. DR has not been able to controvert the findings of Commissioner of Income Tax (Appeals). The assessee has filed copy of ledger extracts of Shree Sai Industries and Soham Metal Pvt. Ltd. for the financial year 2004-05 indicating purchases made during the financial year starting from 01-04-2004 to 31-03-2005. The Department has not raised any doubt over the ledger extracts furnished by the assessee. The letter dated 28-03-2012 along with Annexure-I was filed by the assessee shortly after search. The said letter clearly indica ..... X X X X Extracts X X X X X X X X Extracts X X X X
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