9911796707
TMI Blog2021 (2) TMI 473X X X X Extracts X X X X X X X X Extracts X X X X ..... ller if any - Additions deleted - Decided in favour of assessee. - I.T.A. No.3763 & 3764/Mum/2019, C. O. Nos. 54 & 55/Mum/2020 (Arising out of I.T.A. Nos.3764/Mum/2019 & 3763/Mum/2019) - - - Dated:- 11-2-2021 - Shri Rajesh Kumar, AM And Shri Amarjit Singh, JM For the Assessee : Shri Suchek Achanliya (AR) For the Revenue : Ms. Usha Gaikwad (DR) ORDER PER AMARJIT SINGH, JM: The revenue as well as assessee have filed the above mentioned appeal as well as cross-objection against the order dated 29.03.2019 passed by the Commissioner of Income Tax (Appeals) -29, Mumbai [hereinafter referred to as the CIT(A) ] relevant to the A.Ys.2011-12 2012-13. ITA. NO.3763/Mum/2019 C.O. NO. 55/Mum/2020 2. The revenue has filed the appeal bearing ITA. No.3763/Mum/2019 and the assessee has filed the cross-objection bearing no. 55/Mum/2020 against the order dated 29.03.2019 passed by the CIT(A)-29, Mumbai relevant to the A.Y. 2011-12. Since the common question of law and facts are involved, therefore, the appeal as well as cross-objection is being taken up together for adjudication for the sake of convenience. 3. The revenue has raised the following grounds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , delete or modify any of the above grounds of appeal and requests to consider each of the above grounds without prejudice to one another. 5. The brief facts of the case are that the assessee filed its return of income on 27.09.2011 declaring total income to the tune of ₹ 29,37,174/- for the A.Y.2011-12. The assessment of the assessee was reopened on the basis of the information received from the DGIT(Inv.), Mumbai in which it was conveyed that the assessee has taken the accommodation entries of bogus purchase from the concerns of Rajendra Jain Group. Notice u/s 148 of the act was issued by conveying the following reasons: - Information has been received from the office of the Director General of Income tax (Investigation) Mumbai that the Investigation Wing has carried out Search Seizure action u/s 132 of the Income tax Act, 1961 on Shri Jain Group, Sanjay Choudhary Group Dharmichand Jain Group on 03.10.2013, who are leading accommodation entry providers operating in Mumbai, indulging in providing accommodation entries in the nature of accommodation bills for purchase, unsecured loan Share capitals, etc. The search seizure action resulted in to conclusively pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation of the commission @ 0.50% p.a. on the loan amount. At the, outset of the statement provided during search, I have clatteringly retracted my statement on 08.10.2013 and 15.01.2014. Q.12 Do you wish to state anything else? Ans : I would like to state that we had genuine business relation with M/ s Sangam Diamond and the goods La, cut and polished diamonds were genuinely supplied by me. I would also like to state that neither in nor my companies were involved in providing any kind of accommodation entries. On various intervals I was mentally harassed and tortured and was forcefully asked to commit the offence which was never committed by me. I would like to state that the forceful statement taken from me was retracted by me during the subsequent period 7. Thereafter the show-cause notice was issued stating therein that as to why an amount of ₹ 3,50,49,136/- should not be treated as accommodation entries of bogus purchase and should not be treated as additional income u/s 69C of the I. T. Act, 1961. Thereafter, the assessee submitted the reply. The assessee also relied upon the statement of Shri Dharmchand S. Jain retracted on 05.10.2013. The AO relied upon t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2 Please confirm that the statement recorded u/s. 133A on oath during the course of survey action u/s. 133A on 04/05.10.2013 is true, correct to the best of your knowledge and belief. Further, confirm that the statement was given by you voluntarily, without any force, threat, coercion, inducement, promise or other undue influence. Ans. Yes Sir, I confirm that the statement recorded u/s. 132(4) on oath during the course of search action u/s. 132 at my office on 04/05.10.2013 is true, correct to the best of my knowledge and belief. I also confirm that the statement was given by me voluntarily, without any force, threat, coercion, inducement, promise or other undue influence. Q.5 Please refer to Q. No. 30 of the statement recorded on oath on 04/05.10.2013, wherein you have provided the list of actual importers as per Annexure 8 of the statement. Please provide the further / more details in respect of the importers in the following format. Name of the actual importer Name of the firm/Co./concern Address PAN Contact No. if any Ans. The details of the importers are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shown to have converted into cut and polished diamonds by way of two scenarios The stock of rough diamond imported is shown to have sold on barter system through our commission companies and we receive stock of polished diamonds through commission companies. On receipt of such stock of cut and polished diamonds, we issue sales bills of polished diamonds to the various parties at the request of the actual importers. The actual importer arranges the sale proceeds from parties to whom sale bills were issued. Once sale proceeds are received, we make import remittance at the request of importer. As regards the stock of rough diamond imported, we issue bills of rough diamonds to local purchasers. Similarly, we show purchase of polished diamonds from them to square up the transaction with these local parties. Co receipt of such polish diamonds, thereafter we issue bills of polished diamonds to export parties at the request of actual importers. Actual importers arrange the sale proceeds from the parties to whom we have issued the bills and make import remittance at the request to actual importers. (iii) In some instances, we give delivery to the actual importers and the stoc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and statement of Shri Dharmchand S. Jain, the AO disallowed the bogus purchase in sum of ₹ 3,50,49,136/- and the total income of the assessee was assessed in sum of ₹ 3,79,86,310/-. Subsequently, the assessee filed an appeal before the CIT(A) who restricted the addition to the extent of 4%. The revenue was aggrieved with the restriction of the addition to the extent of 4% and filed an appeal before us to raise the addition of full amount whereas the assessee has filed the cross-objection to delete the 4% addition confirmed by the CIT(A). ISSUE NOS. 1 2 CO 10. Both the grounds are in connection with the restriction of the addition to the extent of 4% of the alleged bogus purchase in sum of ₹ 3,50,49,136/- and cross-objection to delete the addition. Initially, the case of the assessee was reopened on the basis of the information received from the DGIT(Inv.), Mumbai in which it was conveyed that the assessee has taken the bogus purchases entries from the following three parties.:- Name of Party Amount (Rs.) M/s. Maniprabha Impex Pvt. Ltd. 1,77,92,384 M/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the M/s. Kangan Jewels Pvt. Ltd, the ITR return was produced which lies at page no. 74 of the paper book, copy of purchase invoices which lies at page no.75 to 80 of the paper book, account confirmation which lies at page no. 81 to 83 of the paper book, Bank statements of Kangan Jewels Pvt. Ltd. which lies at page no. 84 to 90 of the paper book and affidavit which lies at page no. 91 to 92 of the paper book. The necessary documents in connection with the M/s. Dharam Impex was also produced. The income tax return (ITR) lies at page no. 93 of the paper book, copy of purchase invoices lies at page no. 94 to 98 of the paper book. Account confirmation lies at page no. 99 to 101 of the paper book, bank statement of M/s. Dharam Impex lies at page no. 102 to 109 of the paper book and affidavit lies at page no. 110 to 111 of the paper book. In support of these facts, the assessee also produced his bank statement duly reflecting payment through cheque which lies at page no. 112 to 140 of the paper book. The statement on oath of Dharmichand S. Jain recorded u/s 131 of the I. T. Act, 1961 on 28.11.2017 which lies at page no. 141 to 144 of the paper book. One to one mapping of purchase ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Total 3,50,49,136 12. After recording the said statement and necessary documents produced before the AO, the AO relied upon the statement of the said person i.e. Shri Dharmchand S. Jain which was recorded on 05.10.2013. However, the same was retracted. The documents relied upon by parties were not considered. The documents related to M/s. Maniprabha Impex Pvt. Ltd., M/s. Kangan Jewels Pvt. Ltd. and Dharm Impex have been produced and discussed above which were duly corroborated with the bank statement of the assessee lies at page no. 112 to 140 of the paper book. There is no plausible explanation that as to why the statement of Shri Dharmchand S. Jain recorded u/s 131 of the Act dated 28.11.2017 was not properly considered. This statement was specific in connection with the transactions in question. The statement of Shri Dharmchand S. Jain was considered which was general in nature and got recorded in the year of 2013. There should be cogent and convincing evidence on record to make the addition on record. When the person who sold the article have made the statement before the AO in pursuance of notice to the fact that he did not provide any accommo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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