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TMI Blog2023 (1) TMI 475X X X X Extracts X X X X X X X X Extracts X X X X ..... um proceedings authorities below and ITAT have concurrently arrived at a finding of fact that the claim made by the assessee with regard to its purchase and sales are fictitious for subject assessment year. These findings of fact are not shown to be perverse in any manner. The legal claim made that once a transaction is shown in the books of accounts, it must follow that it is bona fide, is not understood. The transactions shown in the books are found to be false. The assessee has to show the reason why he believed at the time he filed his books, it was true. No such attempt was even made. Facts relevant to confirm the order of penalty has already been discussed in detail vide our order (supra), hence, there is no need to elaborate the facts of the case (as discussed in quantum appeal) again. Relying on the outcome of quantum appeal as decided by us, we dismiss all the grounds raised by assessee in penalty appeal. The assessee has filed inaccurate particulars of income at the time of filing return in order to conceal its income. Thus the provisions of section 271(1)(c) is clearly attracted in the assessee's case While filing the return of income, the assessee failed to of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 06. The appellant may please be permitted to raise any additional or alternative ground on or before thehearing of appeal. 2. Brief facts of the case are that the assessee filed its return of income on 01- 12-1997 declaring total income at Rs 22,40,430/-. A survey was conducted by DDIT (Inv), Mumbai on 22-04-1999 in the case of M/s Geekay Exim India Ltd. During the course of survey, it was found that various concerns of group were engaged in fictitious trading of pharmaceutical goods without actual delivery. A statement u/s 131 was recorded of Shri Rais Ahmed, director pf M/s Geekay Exim India Ltd. Shri Rais Ahmed is also director in assessee company. 3. During the year under consideration assessee made purchases from following parties: Wise Pharma Impex R.Y. Chem F.F. Pharmaceuticals and Pharma Impex. During the course of assessment proceedings for A.Y. 1998-99 statement of Shri F.H. Rizvi the director of these companies were also recorded and he was asked to produce the books of accounts for F.Y 1995-1996 and 1996-1997 but no details were filed. All the goods purchased by the assessee were sold to one single party M/s Ebers Pharmaceuticals Ltd. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no1,2,3 raised by the assessee is found to be base less hence dismissed. Merits of the reasons supplied we will deal with further in our order while discussing the grounds related to merits of the case. 7. We have thoroughly absorbed the contents in the order of the AO and Ld. CIT (A) with submissions of the assessee. The relevant facts relating to adjudication : A statement u/s 131 was recorded of Sri Rais Ahmed director of assessee company wherein he confirmed that he has various concerns of group, engaged in fictious trading of pharmaceutical goods without actual delivery purchases shown by the assessee were never paid off and no confirmation were ever submitted for sundry creditors against those purchases Shri Rais Ahmed himself confirmed that all these transactions were only accommodation entries and the goods were never received. Further Mr F.H. Rizvi who was running the vendor concerns never appeared u/s 131 to confirm the transaction claimed by the assessee. A statement was recorded of shri F.H Rizvi on 07-12-1998 by DDIT (Inv) Mumbai in connection with search on him u/s 132 of the Act. In his statement Shri F.H. Rizvi admitted that there is no genuine sal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lu Mudalair Vs CIT 34 ITR 807 (S.C) In view of the above addition u/s 68 is rightly made and ground no -4 raised by assessee are dismissed. 10. As far as ground no-5 is concerned that has been dealt in detail by the AO in its original order, order of CIT (A) against the earlier assessment order dated 22- 01-2003 (para 5 to 6.1, page 7 and 8 ). No new material or submission /evidence adduced before us. In view of these facts, we confirm the order of the Ld. CIT(A) and this ground no -5 raised by the assessee is also dismissed. 11. In the result, appeal filed by the assessee is fully dismissed. 12. In ITA No. 404/Mum/2016, the assessee has raised the following grounds of appeal: 01. The penalty orders passed upheld by the learned lower authorities u/s 271 (1) (c) of the IT Act, 1961, is bad in law and bad in facts. 02. The learned lower authorities have grossly erred in levying / confirming the levy of penalty us 271 (1) of the IT Act, 1961, at Rs. 1, 90, 00,000/- purely on the basis of addition made to the returned income during the course of the assessment proceeding, without bringing any material or evidence on record to establish the charge of concealment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the cheque is cleared he withdraw the cash and return the same to the parties. Assessees own submissions is contradictory in nature, on the one hand he claims the transactions to be genuine on the other hand he himself claim that he entered into deal bogus transaction to enjoy the facility of bill discounting from various banks. It is also observed through from the orders of the authorities below that the assessee on the one hand giving statement of confession on the other hand claiming the transactions to be genuine without retracting from his statements. To sum up the facts it can be said that assessee entered into a non genuine transaction of purchase which he fails to substantiate by virtue of facts discussed supra. Further there is no evidence of payment of goods, movement of goods and confirmation of credit balance in the books of the assessee and vice versa. Assessee made all the sales exclusively to one party only M/s Eber Pharmaceuticals Ltd amounting to Rs. 2,40,75,750/-. 14. Through its submission, assessee submitted everything but for essential evidences required to establish genuineness of purchase/sales. In its submissions before the authorities bel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the books are found to be false. The assessee has to show the reason why he believed at the time he filed his books, it was true. No such attempt was even made. 18. Facts relevant to confirm the order of penalty has already been discussed in detail vide our order (supra), hence, there is no need to elaborate the facts of the case (as discussed in quantum appeal) again. Relying on the outcome of quantum appeal as decided by us, we dismiss all the grounds raised by assessee in penalty appeal. 19. As the assessee had not disclosed all details in the return of income and the claim of the assessee was not sustainable in law amounting to furnishing of inaccurate particulars or concealment of income on the part of the assessee. The various explanations to section 271(1)( c) only explain the ambiguity in the provisions relating to imposition of penalty and merely because the case of the assessee was not covered by any particular explanation, it did not mean that penalty could not be imposed when there is no difficulty in determining the tax sought to be evaded. Under the provisions of section 271(1) of the IT Act, the penalty is prescribed for concealing the particulars of income or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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