9911796707
TMI Blog2019 (6) TMI 839X X X X Extracts X X X X X X X X Extracts X X X X ..... ER AMARJIT SINGH, JM: The assessee has filed the above mentioned appeals against the different order passed by the Commissioner of Income Tax (Appeals)-2, Pune [hereinafter referred to as the CIT(A) ] relevant to the assessment years 2009-10 2010-11. I.T.A.No.203/M/2018 2. The assessee has filed the present appeal against the order dated 22.09.2017 passed by the Commissioner of Income Tax (Appeals)-2, Pune [hereinafter referred to as the CIT(A) ] relevant to the assessment year 2009-10. 3. The assessee has raised the following grounds: - I) The Ld. CIT(A)-2 Pune Camp Office Thane has erred in confirming the addition of ₹ 6,04,182/- made on account of alleged hawala Purchases. 2. The appellant craves, leave to add, alter, amend and modify the aforesaid ground, of appeal at or any time before the hearing as may be advised from time to time. B. Relief claimed 1. The addition confirmed to the tune of ₹ 6,04,182/- by the CIT(A)-2 Pune Camp Office Thane on account of alleged hawala purchase being not warranted by facts be deleted. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee has filed the present appeal before us. ISSUE NO. 1 5. We have heard arguments advanced by the Ld. Representative of the Department and gone through the record carefully. The assessee has challenged the confirmation of the addition of bogus purchase in sum of ₹ 6,04,182/-. The notice was given to the assessee but the assessee failed to attend the proceeding before us also. Before going further, we deem it necessary to advert the finding of the CIT(A) on record.:- 5.1 I have perused the facts as mentioned in the assessment order as well as arguments taken on behalf of the appellant. On a perusal of the facts, it is seen that the Sales Tax Department informed that the appellant was beneficiary of hawala purchases to the tune of ₹ 6,04,182/- from the three entry providers as under: Sr. No Name of the Entry Provider Maharastra VAT A.Y. Amount in the purchase bills taken by the assessee 1 Modern Traders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. No details of transportation was filed containing vehicle number nor, octroi receipts were filed. vi. No purchase orders and stock register could be produced. 5.5 The Ld. Counsel of the appellant has placed reliance on the ratio laid down in the case of CIT vs. Nikunj Eximp Enterprises Pvt. Ltd. (Supra). In the facts of the case before the Hon'ble Bombay High Court, the addition on account of bogus purchases made by the Assessing Officer and upheld by the CIT(A), was deleted by the Tribunal in view of the following factual positions: i. Letters of confirmation from suppliers were filed. ii. Copies of Bank statement showing entries of payment through A/c payee cheques to the suppliers. iii. Stock statements with complete details of opening stock, purchases, sales and closing stock were filed. iv. Substantial amount of sales were made to the Government Departments like Defence Research and Development Laboratory, Hyderabad. 5.6 The Hon ble Bombay High Court upheld the order of the Tribunal in view of above factual aspect and held that disallowance cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee. Admittedly the dealer had not even paid VAT against such passing of goods. iii. The case where the Assessing Officer had confronted the information received from the Sales Tax Department and had supplied copies of statements recorded and had also issued notice under section 133(6) of the Act, where hawala dealer was not traceable and in the absence of the assessee failing to file any documentary evidence of delivery of goods, addition is to be upheld in the hands of assessee on account of such bogus purchases. iv, The next instance s the case of goods which have been admittedly sold by the hawala dealer and has been received by the assessee, who in turn had maintained quantitative details and also evidence of its movement i.e. transportation details and quality control details of consumption of the said material or exact details of sale of the same consignment through same transporter directly to the party, then 'he total purchases cannot be added in the hands of assessee. However, since the purchases are made from the grey market, some estimation needs to be made in the hands of assessee. The Tribunal in MIs. Chetan Enterprises Vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7; 2,92,93,288/- and taxing only 25% of these bogus claim goes against the principles of Sections 68 and 69C of the Income Tax Act. The entire purchases shown on the basis of fictitious invoices have been debited in the trading account since the transaction has been found to be bogus. The Tribunal having once come to a categorical finding that the amount of ₹ 2,92,93,288/- represented alleged purchases from bout's suppliers it was not incumbent on it to restrict the disallowance to only ₹ 73,23,322/, 5.11 In the above case, Hon'ble ITAT had given the finding that entire purchases were claimed in the P L account on the basis of fictitious invoices. The finding was based on seized materials and other documents. Hon ble ITAT had confirmed only 25% of the purchases as disallowable and not 100% as made by the AO. Hon'ble Court in view of these facts held that once the entire purchases were found to be bogus then restricting the disallowance only to the extent of 25% goes against the principle of Section 69C of the IT Act. It is further noticed that SLP filed against the decision of Hon'ble High Court was dismissed by the Hon'ble Supreme ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
