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TMI Blog2024 (8) TMI 869X X X X Extracts X X X X X X X X Extracts X X X X ..... ound in the reopening of the assessment. Reopening of assessment without proper opportunity of cross-examination - The opportunity of cross-examination does not hamper the case of the assessee because the assessee on its own could not fulfil and show the genuineness of the purchases, therefore, there is no ground to entertain the argument of the learned authorized representative about failure on part of the assessing officer to grant an opportunity of cross-examination. Estimation of income - Assessee is into the business of ferrous and nonferrous metal as a trader, therefore if there is a bogus purchase, and quantitative details are available, only the profit embedded therein is required to be taxed in the hands of the assessee. Honourable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a trader in Farah s and nonferrous metal. The name of the assessee appears as a beneficiary in obtaining accommodation entries and hawala bills from non-existing entity is discovered by Maharashtra sales tax department and information passed on to the assessing officer by the director general of income tax, investigation Wing, Mumbai that assessee has made purchases of Rs. 3,620,179/ from one party namely Sai Kripa metallic traders. Therefore, the notice under section 148 was issued on 19/2/2014 which was not responded to. Further notices under section 142 (1) were issued to the assessee and there was no response. Therefore, the learned assessing officer passed an assessment order wherein he made an addition on account of nongenuine purchas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal is not given is absolutely false. On the issue of reopening of the assessment it was submitted that there is a tangible material in the form of information received that assessee has obtained the bogus invoices from one party. The assessee failed to prove the genuineness of such purchases; several details were asked of them were filed before the learned assessing officer therefore it shows that the reasons recorded by the learned assessing officer are correct. On the issue of cross examination, he submits that when the assessee has failed to prove the genuineness of the purchases itself independently, neither the statement of the hawala operators were used for making the addition and therefore there is no need of granting cross examin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der, therefore if there is a bogus purchase, and quantitative details are available, only the profit embedded therein is required to be taxed in the hands of the assessee. Honourable Bombay High Court in case of Monmouth Haji Adam has laid down the amount of addition required to be made in the hands of the assessee if the purchases are bogus. Therefore, we direct the learned assessing officer to make the addition to that extent only. For this purpose, as the information is not available before us, we are handicap and restore the issue back to the file of the learned assessing officer with a direction to the assessee to produce the net profit ratio of purchases which are not alleged to be bogus and net profit ratio of purchases which are all ..... X X X X Extracts X X X X X X X X Extracts X X X X
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