9911796707
TMI Blog2023 (5) TMI 999X X X X Extracts X X X X X X X X Extracts X X X X ..... sonable opportunity of hearing to assessee. 2. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of income-Tax (Appeals), NFAC has erred confirming the action of assessing officer in imposing penalty of Rs.7,34,48,950/- u/s 271(1)(c) of the I.T. Act, 1961. 3. It is therefore prayed that penalty imposed by assessing officer and confirmed by Commissioner of Income-tax (Appeals) may please be deleted. 4. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal." 3. At the outset, Shri Sapnesh Sheth, Ld. Counsel for the assessee, begins by pointing out that the quantum addition, in respect of penalty imposed by the Assessing Officer under section 271(1)(c) of the Act, has been remitted back to the file of the Ld. CIT(A) for fresh adjudication. Since the quantum involved on which the penalty was imposed by the Assessing Officer under section 271(1)(c) of the Act, has been remitted back to the file of the Ld. CIT(A) for fresh adjudication, therefore the penalty in respect of quantum involved should also be remitted back to the file of the Ld. CIT(A) for fresh adjudication. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing officer in making addition of Rs.64,00,000/- as unexplained credits u/s 68 of Income Tax Act, 1961. 3. It is therefore prayed that addition made by assessing officer and confirmed by Commissioner of Income-tax (Appeals) may please be deleted. 4. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal." 8. Succinct facts qua ground No. 2 are that during the assessment proceedings the assessing officer got information from investigation wing that M/s Delight Diam P Ltd. and M/s Bafna Exim Pvt. Ltd. are not carrying out any real business but are only providing accommodation entries. The investigation wing also recorded statement of Shri Deepak Kailash Babel and Sh. Pravin Kumar Jain, the key persons of M/s Delight Diam P Ltd and M/s Bafna Exim Pvt Ltd respectively. The assessee did not respond to initial notices however, as per assessment order assessee has given reply to assessing officer on 23.11.2019. The impugned amount in ground No.2 of the assessee at Rs.64,00,000/- comprises, of an amount of Rs.45,00,000/- as purchases and an amount of Rs.15,00,000/- as advance against goods from M/s Delight Diam Pvt Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one conclusion that the purchases shown by the assessee are unverifiable. Since the purchases are not verifiable in toto, it is needless to reiterate that in respect of claim of any expenditure, the entire onus lies upon the assessee to prove that the expenditure was incurred wholly and exclusively for the purpose of business. The word 'wholly' refer to the quantum of expenditure. The word 'exclusively' refer to the motive object and purpose of the expenditure. As per the ratio laid down in the decision of Delhi High Court in the case of Siddhe mal & Sons vs CIT reported in 122 ITR 839 the Assessing Authorities are empowered to examine the expenditure from the aforesaid stand points. The law does not prescribe any quantitative test to find out whether the onus in a particular case has been duly discharged. It all depends on facts and circumstances of the case as laid down in the decision of Gauhati High court in the case of Assam Pesticides and Agro Checmicals vs CIT reported in 227 ITR 384. Here, reference is also invited to the decision of Hon'ble ITAT in the case of M/s. Vijay Proteins Ltd. reported in 55 TTJ 76 wherein, owing to non-verifiable purchases. 25% of the sum of p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ased on these documents and details, the ld Counsel contended that assessee had proved the genuineness of the transactions, hence addition made by the assessing officer may be deleted. 13. The Ld. Counsel also took us through the paper book page nos.35, wherein it is stated that amount has been repaid in the same year, therefore addition should not be made by the Assessing Officer. The Ld. Counsel also stated that during the assessment proceedings, the assessee has demanded the opportunity of cross-examination, however the Assessing Officer has not provided the opportunity of cross-examination of the concerned parties. The Ld. Counsel therefore prays the Bench that assessee submitted enough documents and evidences to prove the genuineness of the transactions, therefore addition made in the hands of the assessee may be deleted. 14. On the other hand, Ld. DR for the Revenue submitted that Assessing Officer was right in initiating the re-assessment proceedings under section 147 of the Act. The Ld. DR pointed out that there was a specific information received by the Assessing Officer from the Investigation Wing and such specific information was not available during the original asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s submitted the ledger copy of M/s Delight Diam Pvt. Ltd. which is paced at paper book page no. 35. The ledger copy of M/s Bafna Exim Pvt. Ltd. which is placed at paper book page no.36. The statement of M/s Sona Enterprise (assessee business concern) indicating payment made to M/s Delight Diam Pvt Ltd and M/s Bafna Exim Pvt. Ltd. for purchases made, which is placed at paper book page nos. 37 to 45. Therefore, we note that assessee has repaid the amount during the assessment year itself, hence the genuineness of the transactions should not be doubted. We note that Hon`ble Gujarat High Court in the case of Ambe Tradecorp (P.) Ltd, [2022] 145 taxmann.com 27 (Gujarat) held that where assessee took loan from two parties and assessee had furnished requisite material showing identity of loan givers and that assessee was not beneficiary as loan was repaid in subsequent year, no addition under section 68 could be made on account of such loan. The findings of the Hon`ble Court is reproduced below: "4. Learned advocate for the appellant attempted to emphasize that for the purpose of application of section 68 of the Act, three ingredients were necessary. Firstly identity of the parties to th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
