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TMI Blog2017 (4) TMI 1308X X X X Extracts X X X X X X X X Extracts X X X X ..... Decided in favour of assessee. - ITA No.1311/Ahd/2014 - - - Dated:- 28-4-2017 - Pramod Kumar AM and S S Godara JM For The Appellant : K.C. Thaker For The Respondent : Prasoon Kabra ORDER Per Pramod Kumar, AM: 1. By way of this appeal, the assessee appellant has challenged correctness of the order dated 12th February 2013, passed by the learned CIT(A), in the matter of assessment under section 143(3) r.w.s. 147 of the Income Tax Act, 1961, for the assessment year 2006-07. 2. In the first ground of appeal, the assessee has raised the following grievance against learned CIT(A) s upholding validity of reassessment proceedings :- 1. The learned CIT(A) has erred in law and on facts in holding that the reopening proceedings under section 147 are justified and in dismissing the ground contesting the same and the validity of assessment made in pursuance of such proceedings. 3. Learned representatives submit that the reasons for reopening the assessment in this case are materially the same as for the assessment year 2005-06 which was heard along with this appeal, and, therefore, whatever is decided in the assessment year 2005-06 on this issue w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing total income at ₹ 2851250. Since the tax as per MAT was higher than that of the normal provisions of the IT. Act, the income was finally determined at ₹ 10116390 as per the MAT. It is pertinent to mention here that an action was carried out by DGCEI. Vapi. at the premise of M/s. H. K. Impex Pvt. Ltd., Umbergaon , Gujarat and consequently at the factory premise of M/s. Shah Foils Pvt. Ltd. at Santej, Kalol and Ambica Transport Services, Ahrnedabad. During the course of statement, Director of assessee company Shri Kartik Shah submitted that the goods were being transported from their factory premise at Santej to Vasai/Bhayander, Maharashtra instead of the destination mentioned on the invoice and the LR being the factory premises of M/s. H.K. Impex Pvt. Ltd. Umbergaon, Gujarat. From the above discussion, it is clear that the assessee company by resorting to unaccounted sales to various parties at Vasai/Bhyanader was involved in the Tax Evasion during the assessment year 2005-06. As per the copies of ledger accounts, the purchases amounting to ₹ 6972741 for A.Y. 2005-06 have been shown by M/s. H. K. Impex Pvt. Ltd. from the assessee which is the unaccounted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e challan is incorrect. Further, payment by cheque in itself is not the conclusive proof for genuineness of any transaction. Moreover, the statements of the Directors of this company have been corroborated by the Transporter also. Therefore, the submissions made by the assessee are not acceptable and the same are hereby rejected. 9. In view of the above, it is clear that the assessee has made unaccounted sales of ₹ 69,72,741/- during the year under consideration. It implies that either the assessee is making unaccounted production or making purchases in cash. Even in case of purchase in cash, the same is not an allowable expenditure under the provisions of section 40A(3) of the Act. Therefore, entire unaccounted sales of ₹ 69,72,741/- is hereby added to the total income of the assessee. Penalty proceedings u/s.271(1)(c) are initiated for furnishing inaccurate particulars of income. 5. Aggrieved, assessee carried the matter in appeal but without any success. Learned CIT(A) upheld the addition made by the Assessing Officer, though as unexplained credit rather than as unaccounted sales . The operative portion of the CIT(A) s order is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce, Vapi on 19.06.2007. It is on this basis that the Assessing Officer formed the belief that the assessee had made unaccounted sales. However, when we perused this statement, we are unable to find any indication about unaccounted sales. All that this statement shows is that the goods sent by the assessee was delivered to H.K. Impex Pvt. Ltd. was delivered at an address other than it s premises at GIDC Estate, Umbergaon. In this context, following extracts from the aforesaid statement may be referred to :- Q-1. Kindly explain how you arrange the transportation of S.S. Coils from your factory to the consignee s address ? Ans: Once the S.S. Coils are ready for dispatch we contact our transporter M/s. Ambica Transport Services, Ahmedabad who arranges the Trucks and then goods are loaded and necessary documents like Central Excise Invoice, Gate pass L.R are prepared. Copy of Invoice and L.R are handed over to the Truck driver for delivery at consignee's address. Q-2. In case the goods are to be delivered at a place other than the consignee's address given in Invoice L.R do you prepare any document for delivery of goods at other place? Ans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cleared on payment of duty and M/s. H.K. Impex Pvt Ltd wanted them to be delivered at Vasai for their own reasons we have no option but to comply their instructions. Q-7. Can you name the addresses of the units at Vasai Bhayander area where SS coils purchased by M/s HK Impex Pvt. Ltd., were delivered since the places of delivery was known to Shri Dhiraj Jain who paid the varai for such deliveries? Ans I do not know the names and addresses of the unit where SS coils were delivered. I know only that they have been delivered at various locations at Vasai Bhayander area for reasons better known to M/s. H.K. Impex Pvt. Ltd. 9. In our considered view, no reasonable person can draw an inference, from the above statement, that the sales itself was unaccounted. All that the statement evidences was that delivery was given at some other address, other than the premises of H.K. Impex Pvt. Ltd., and that aspect of the matter was relevant from the point of view as to whether, for example, HK Impex Pvt. Ltd. actually exported these goods at all or not. In our considered view, therefore, the reasons recorded for reopening the assessment were factually incorrect. There was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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