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Facts
The assessee, Danco Enterprises India Pvt. Ltd., appealed against assessment orders for AY 2016-17 and 2017-18. The Assessing Officer initiated reassessment proceedings under Section 147 based on information that the 'One World group' engaged in bogus entries, and the assessee was a beneficiary of bogus purchases amounting to Rs. 9,37,20,787/- from M/s. Basant Marketing Limited.
Held
The Tribunal held that the reassessment proceedings were validly initiated, dismissing the assessee's ground challenging the jurisdiction. However, regarding the merit of the addition, the Tribunal decided to restore the issue back to the Assessing Officer for fresh adjudication in light of additional evidence filed by the assessee.
Key Issues
1. Whether the reassessment proceedings initiated under Section 147 were valid. 2. Whether the purchases from M/s. Basant Marketing Limited were genuine or bogus, and if bogus, whether the addition under Section 69C was justified.
Sections Cited
147, 69C, 148, 142(1), 144
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Income Tax Appellate Tribunal, MUMBAI BENCH “D” MUMBAI
Before: SHRI OM PRAKASH KANT & SHRI SUNIL KUMAR SINGH
therefore same were heard together and disposed off by way of this therefore same were heard together and disposed off by way of this therefore same were heard together and disposed off by way of this consolidated order for the sake of convenience. consolidated order for the sake of convenience.
Firstly, we take up the appeal of the assessee in take up the appeal of the assessee in take up the appeal of the assessee in 2016 24 for assessment year 2016-17. The grounds raised 17. The grounds raised by the assessee are reproduced as under: by the assessee are reproduced as under:
On the facts and in the circumstances of the case and On the facts and in the circumstances of the case and On the facts and in the circumstances of the case and in law the Ld. NFAC erred in not considering the fact in law the Ld. NFAC erred in not considering the fact in law the Ld. NFAC erred in not considering the fact that the assumption of jurisdiction by the Ld. Assessing that the assumption of jurisdiction by the Ld. Assessing that the assumption of jurisdiction by the Ld. Assessing Officer is bad in law as the conditions laid down under Officer is bad in law as the conditions laid down under Officer is bad in law as the conditions laid down under the Act for initiating reassessment proceeding u/s 147 the Act for initiating reassessment proceeding u/s 147 the Act for initiating reassessment proceeding u/s 147 of the Act have not been fulfilled. of the Act have not been fulfilled.
2. On the facts and in the circumstances of the case and On the facts and in the circumstances of the case and On the facts and in the circumstances of the case and in law, the Ld. NFAC erred in confirming entire addition in law, the Ld. NFAC erred in confirming entire additi in law, the Ld. NFAC erred in confirming entire additi of Rs. 9,37,20,787/ of Rs. 9,37,20,787/- under section 69C of the Act on under section 69C of the Act on account of purchases of various materials from M/s account of purchases of various materials from M/s account of purchases of various materials from M/s Basant Marketing Private Limited by treating them as Basant Marketing Private Limited by treating them as Basant Marketing Private Limited by treating them as alleged bogus purchases without appreciating the facts alleged bogus purchases without appreciating the facts alleged bogus purchases without appreciating the facts that the appellant has made genuine purch that the appellant has made genuine purchases for the ases for the electrical turnkey project in the regular course of electrical turnkey project in the regular course of electrical turnkey project in the regular course of business. business.
Briefly stated, facts of the case are that the assessee, a private Briefly stated, facts of the case are that the assessee, a private Briefly stated, facts of the case are that the assessee, a private limited company was engaged in the business of electrical turn key limited company was engaged in the business of electrical turn key limited company was engaged in the business of electrical turn key projects, contracts and trading of the goods projects, contracts and trading of the goods. During the year under . During the year under reference, the assessee filed return of income on 29.11.2016 he assessee filed return of income on 29.11.2016 he assessee filed return of income on 29.11.2016 declaring total income at Rs.63,60,965/ declaring total income at Rs.63,60,965/-. Subsequently, the . Subsequently, the Assessing Officer received information that a search action was Assessing Officer received information that a search action was Assessing Officer received information that a search action was carried out in “One One World group” on 08.02.2020 . I . In said search proceedings, it was found that it was found that “One World group group” entities were engaged in the business of providing bogus entries and the assessee engaged in the business of providing bogus entries and the assessee engaged in the business of providing bogus entries and the assessee being one of the beneficiary of receiving bogus/accommodation being one of the beneficiary of receiving bogus/accommodation being one of the beneficiary of receiving bogus/accommodation
Danco Enterprises India Pvt. Ltd. Danco Enterprises India Pvt. Ltd. 3 & 5023/MUM/2024 & 5023/MUM/2024 entry from ‘One World One World group’ concern of bogu concern of bogus purchases amounting to Rs.9,37,20,787/ amounting to Rs.9,37,20,787/- in the period relevant to the in the period relevant to the assessment year under consideration. Accordingly, the Assessing assessment year under consideration. Accordingly, the Assessing assessment year under consideration. Accordingly, the Assessing Officer recorded reasons to believe that income escaped assessment Officer recorded reasons to believe that income escaped assessment Officer recorded reasons to believe that income escaped assessment and issued notice u/s 148 of the Act on 31.03.2021. In response, and issued notice u/s 148 of the Act on 31.03.2021. I and issued notice u/s 148 of the Act on 31.03.2021. I the assessee filed return of income on 15.12.2021 declaring total the assessee filed return of income on 15.12.2021 declaring total the assessee filed return of income on 15.12.2021 declaring total income at Rs.63,60,970/ income at Rs.63,60,970/-. In the course of the reassessment . In the course of the reassessment proceedings, the assessee filed detail of purchase invoices, letter of proceedings, the assessee filed detail of purchase invoices proceedings, the assessee filed detail of purchase invoices credit, party ledger, delivery challans, lorry credit, party ledger, delivery challans, lorry receipt, payment details etc. and explained as as why the purchases had increased to 160% as why the purchases had increased to 160% as compared to last year. The Assessing Officer further called for compared to last year. The Assessing Officer further called for compared to last year. The Assessing Officer further called for details supporting transportation for purchase and relevant copies details supporting transportation for purchase and relevant copies details supporting transportation for purchase and relevant copies of document but same were not submi same were not submitted. Then, Assessing Officer Assessing Officer referred to statement of Shri Rajesh Mehta, CEO M/s Basant referred to statement of Shri Rajesh Mehta, CEO M/s Basant referred to statement of Shri Rajesh Mehta, CEO M/s Basant Marketing Ltd. which is one of the concern of the Marketing Ltd. which is one of the concern of the One One World group. The relevant finding The relevant finding of the Assessing Officer is reproduced as of the Assessing Officer is reproduced as under:
“14. On further verification 14. On further verification of information and Invoices of information and Invoices submitted by the assessee, 90% of the submitted invoices were submitted by the assessee, 90% of the submitted invoices were submitted by the assessee, 90% of the submitted invoices were from M/s. Basant Marketing Limited. During the search from M/s. Basant Marketing Limited. During the search from M/s. Basant Marketing Limited. During the search proceedings in the case of M/s.Oneworld group in Mumbai, a proceedings in the case of M/s.Oneworld group in Mumbai, a proceedings in the case of M/s.Oneworld group in Mumbai, a statement was recorded from Shri. Rajesh Mehta on 08. statement was recorded from Shri. Rajesh Mehta on 08. statement was recorded from Shri. Rajesh Mehta on 08.11.2019 the CEO of M/s. Basant Marketing Limitedl. In his statement, the CEO of M/s. Basant Marketing Limitedl. In his statement, the CEO of M/s. Basant Marketing Limitedl. In his statement, Shri. Rajesh Mehta had admitted as under: Shri. Rajesh Mehta had admitted as under: " There is no business carried out in these companies. The " There is no business carried out in these companies. The " There is no business carried out in these companies. The companies exist on paper and are used by several persons to companies exist on paper and are used by several persons to companies exist on paper and are used by several persons to generate bogus sales and b generate bogus sales and bogus purchases. I get a commission ogus purchases. I get a commission in the range of 54 paisa per 100Rs. Transaction for letting other in the range of 54 paisa per 100Rs. Transaction for letting other in the range of 54 paisa per 100Rs. Transaction for letting other persons to use my companies" persons to use my companies"
Danco Enterprises India Pvt. Ltd. Danco Enterprises India Pvt. Ltd. 4 & 5023/MUM/2024 & 5023/MUM/2024
It is very clear from the above statement from CEO of M/s. 15. It is very clear from the above statement from CEO of M/s. 15. It is very clear from the above statement from CEO of M/s. Basant Marketing Basant Marketing Limited that their company had provided Limited that their company had provided bogus bills for purchases. In this instant case, out of the total bills for purchases. In this instant case, out of the total bills for purchases. In this instant case, out of the total puchases, purchases amounting to Rs.9,37,20,787/ puchases, purchases amounting to Rs.9,37,20,787/-were made were made from M/s.Basant Marketing Limited. from M/s.Basant Marketing Limited.
In response to show cause notice issued, the assessee has 16. In response to show cause notice issued, the assessee has 16. In response to show cause notice issued, the assessee has requested for requested for personal hearing through Video conference and ideo conference and the assessee was heard on the assessee was heard on 30.03.2022@ 6.20 PM. The 30.03.2022@ 6.20 PM. The assessee explained with regard to the issue and also requested assessee explained with regard to the issue and also requested assessee explained with regard to the issue and also requested not to consider the purchases as bogus purchases. not to consider the purchases as bogus purchases.
The explanation of the assessee were carefully examined. 17. The explanation of the assessee were carefully examined. 17. The explanation of the assessee were carefully examined. The same cannot be accepted as it is very clear from the above nnot be accepted as it is very clear from the above nnot be accepted as it is very clear from the above discussion that the purchases amounting to Rs. 9,37,20,787/ discussion that the purchases amounting to Rs. 9,37,20,787/ discussion that the purchases amounting to Rs. 9,37,20,787/- were bogus purchases only. were bogus purchases only. 18. On the above circumstances, the purchases made from M/s. 18. On the above circumstances, the purchases made from M/s. 18. On the above circumstances, the purchases made from M/s. Basant Marketing Limited by the assessee is to be treat Marketing Limited by the assessee is to be treated as Marketing Limited by the assessee is to be treat bogus purchases and the same were treated as unexplained bogus purchases and the same were treated as unexplained bogus purchases and the same were treated as unexplained expenditure u/s.69C of the Act and added to the returned expenditure u/s.69C of the Act and added to the returned expenditure u/s.69C of the Act and added to the returned income of the assessee. income of the assessee. 4. On further appeal, the assessee submitted that in response to On further appeal, the assessee submitted that in response to On further appeal, the assessee submitted that in response to the show cause notice the show cause notice issued by the Assessing Officer, the assessee Officer, the assessee stated that there were no transactions were no transactions with ‘One One World group. ’ Further submitted that urther submitted that during relevant period purchases were purchases were made through agents who used to set up deals and cont through agents who used to set up deals and cont through agents who used to set up deals and contact the supplier and in return to used gets commission either from the supplier and in return to used gets commission supplier and in return to used gets commission purchaser or the seller or the both. The or the seller or the both. The assessee submitted that assessee had purchased assessee had purchased the goods through agents and not directly. through agents and not directly. Further, it was submitted that corresponding sales were also made. it was submitted that corresponding sales were also made. it was submitted that corresponding sales were also made. The Ld. CIT(A) however rejected the conten The Ld. CIT(A) however rejected the contention of the assessee and tion of the assessee and upheld the disallowance observing as under: upheld the disallowance observing as under:
“6.3.4 During the course of present appellate proceedings, the 6.3.4 During the course of present appellate proceedings, the 6.3.4 During the course of present appellate proceedings, the assessee has failed to rebut the findings of the AO. As from the assessee has failed to rebut the findings of the AO. As from the assessee has failed to rebut the findings of the AO. As from the Danco Enterprises India Pvt. Ltd. Danco Enterprises India Pvt. Ltd. 5 & 5023/MUM/2024 & 5023/MUM/2024 above discussion, as the company M/s. Basant. Marketing above discussion, as the company M/s. Basant. Marketing above discussion, as the company M/s. Basant. Marketing Limited had provided bogus bills for purchases, I am of the considered had provided bogus bills for purchases, I am of the considered had provided bogus bills for purchases, I am of the considered opinion that the AO rightly made the impugned addition of opinion that the AO rightly made the impugned addition of opinion that the AO rightly made the impugned addition of Rs.9,37,20,787/ Rs.9,37,20,787/- warranting no interference of the appellate warranting no interference of the appellate authority. Therefore, the Grounds raised by the assessee on this authority. Therefore, the Grounds raised by the assessee on this authority. Therefore, the Grounds raised by the assessee on this issue are dismissed. ssue are dismissed.”
5. Before us, the Ld. counsel for the assessee filed a Paper Book Before us, the Ld. counsel for the assessee filed a Paper Book Before us, the Ld. counsel for the assessee filed a Paper Book containing pages 1 to 127. containing pages 1 to 127.
The ground No. 1 of the appeal of the assessee relate t The ground No. 1 of the appeal of the assessee relate t The ground No. 1 of the appeal of the assessee relate to validity of the reassessment. T validity of the reassessment. The assessee has mainly contested he assessee has mainly contested that jurisdiction as assumed by the Assessing Officer is bad in law as assumed by the Assessing Officer is bad in law as assumed by the Assessing Officer is bad in law as the condition laid down as the condition laid down under the Act for initiating pr initiating proceedings u/s 147 of the Act have u/s 147 of the Act have not been fulfilled. The Ld. counsel for the not been fulfilled. The Ld. counsel for the assessee referred to Paper Book page 40, which is a copy of the assessee referred to Paper Book page 40, which is a copy of the assessee referred to Paper Book page 40, which is a copy of the reasons recorded and submitted that the Assessing Officer has not ns recorded and submitted that the Assessing Officer has not ns recorded and submitted that the Assessing Officer has not referred to M/s Basant Marketing Pvt. Ltd. in the reasons recorded referred to M/s Basant Marketing Pvt. Ltd. in the reasons recorded referred to M/s Basant Marketing Pvt. Ltd. in the reasons recorded and only referred to and only referred to One World group concern. The Ld. counsel concern. The Ld. counsel submitted that the detail of the submitted that the detail of the One World group were not provided were not provided to the assessee during the reassessment proce to the assessee during the reassessment proceedings, i edings, in spite of specific request made to the Assessing Officer vide letter dated specific request made to the Assessing Officer vide letter dated specific request made to the Assessing Officer vide letter dated 18.03.2022. The Ld. counsel further referred that even in the show 18.03.2022. The Ld. counsel further referred that even in the show 18.03.2022. The Ld. counsel further referred that even in the show cause notice issued also there was no reference of M/s Basant cause notice issued also there was no reference of cause notice issued also there was no reference of Marketing Pvt. Ltd. Accordingly Marketing Pvt. Ltd. Accordingly, he assailed the reasons recorded he assailed the reasons recorded and submitted that reasons recorded are vague and based on the and submitted that reasons recorded are vague and based on the and submitted that reasons recorded are vague and based on the presumptions only, hence reassessment proceedings are bad in law , hence reassessment proceedings are bad in law , hence reassessment proceedings are bad in law and need to be quashed. and need to be quashed.
Danco Enterprises India Pvt. Ltd. Danco Enterprises India Pvt. Ltd. 6 & 5023/MUM/2024 & 5023/MUM/2024 6.1 On the contrary, the Ld. D On the contrary, the Ld. Departmental Representative ( epartmental Representative (DR) submitted that ‘sufficiency’ submitted that ‘sufficiency’ or the ‘correctness’ of the material relied of the material relied upon for reopening is not to be seen upon for reopening is not to be seen at the stage of recording the stage of recording reasons and matter reasons and matter could be examined during the reassessment the reassessment proceedings. proceedings. He He submitted submitted that t hat during during the the reassessment reassessment proceedings, the assessee was duly intimated the name of the entity proceedings, the assessee was duly intimated the name of the entity proceedings, the assessee was duly intimated the name of the entity M/s Basant Marketing Pvt. Ltd. from whom the assessee had made M/s Basant Marketing Pvt. Ltd. from whom the assessee had made M/s Basant Marketing Pvt. Ltd. from whom the assessee had made purchases which were under the cloud. Therefore, he rejected the ses which were under the cloud. Therefore, he rejected the ses which were under the cloud. Therefore, he rejected the contention of the assessee. contention of the assessee.
6.2 We have heard rival submissions of the parties and perused We have heard rival submissions of the parties and perused We have heard rival submissions of the parties and perused the relevant materials on record the relevant materials on record. The reasons recorded in the case . The reasons recorded in the case of the assessee as available on Paper Book page 40 are reproduced of the assessee as available on Paper Book page 40 are reproduced of the assessee as available on Paper Book page 40 are reproduced as under:
“Sir/ Madam/ M/s, Sir/ Madam/ M/s, Subiect: Re-opened assessment proce opened assessment proceedings u/s.147 of the Act edings u/s.147 of the Act - in your case - PAN : PAN : AAECD1889M - AY : 2016-17- Regarding. Regarding. Ref: Your letter dated 15.12.2021. Ref: Your letter dated 15.12.2021. Sub: Submission of Information and documents. Sub: Submission of Information and documents. With reference to the above With reference to the above-mentioned notice u/s 144 of the Income mentioned notice u/s 144 of the Income- tax Act, 1961 ,we tax Act, 1961 ,we hereby state submit & request before your good hereby state submit & request before your good- self as under: self as under: 1. " As per the information and details available with this office, the " As per the information and details available with this office, the " As per the information and details available with this office, the assessee has taken accommodation entry of bogus purchase of assessee has taken accommodation entry of bogus purchase of assessee has taken accommodation entry of bogus purchase of Rs.9,37,20,787/ Rs.9,37,20,787/- during the financial year 2015-2016 from One 2016 from One world group concerns who is engaged in the business of bogus world group concerns who is engaged in the business of bogus world group concerns who is engaged in the business of bogus entries and the group companies are paper companies and there entries and the group companies are paper companies and there entries and the group companies are paper companies and there were no real business activities and has shown bogus were no real business activities and has shown bogus were no real business activities and has shown bogus purchases and bogus sales. purchases and bogus sales.
Danco Enterprises India Pvt. Ltd. Danco Enterprises India Pvt. Ltd. 7 & 5023/MUM/2024 & 5023/MUM/2024
Hence, reason to believe that this amount of Rs.9,37, Hence, reason to believe that this amount of Rs.9,37, Hence, reason to believe that this amount of Rs.9,37,20,787/- chargeable to tax has escaped from assessment within the meaning chargeable to tax has escaped from assessment within the meaning chargeable to tax has escaped from assessment within the meaning of sec. 147 of the IT Act". of sec. 147 of the IT Act". With reference to the above we would like to state that we have not With reference to the above we would like to state that we have not With reference to the above we would like to state that we have not made any purchases/sales amounting to Rs.9,37,20,787/ made any purchases/sales amounting to Rs.9,37,20,787/ made any purchases/sales amounting to Rs.9,37,20,787/- from One World Group.” One World Group.” 6.3 On perusal of the above, we find that the Assessing Officer has perusal of the above, we find that the Assessing Officer has perusal of the above, we find that the Assessing Officer has recorded reasons based on the information received during the recorded reasons based on the information received during the recorded reasons based on the information received during the course of the search proceedings at the premises of the one-word course of the search proceedings at the premises of the one course of the search proceedings at the premises of the one group. It is noted that M/s Basant Marketing Pvt. Ltd. is one of the t is noted that M/s Basant Marketing Pvt. Ltd. is one of the t is noted that M/s Basant Marketing Pvt. Ltd. is one of the group of the One World group World group, thus, the information is not factually the information is not factually in incorrect to that extent. The Assessing Officer has mentioned the in incorrect to that extent. The Assessing Officer has mentioned the in incorrect to that extent. The Assessing Officer has mentioned the purchase amount in the reasons recorded which is also referred in purchase amount in the reasons recorded which is also referred in purchase amount in the reasons recorded which is also referred in the books of account of the assessee the books of account of the assessee corresponding corresponding purchase fro M/s Basant Marketing Pvt. Ltd Marketing Pvt. Ltd. In the circumstances, we do not . In the circumstances, we do not find any vagueness in the reasons record find any vagueness in the reasons recorded, therefore, the ground , therefore, the ground challenging validity of reassessment is accordingly dismissed. challenging validity of reassessment is accordingly dismissed. challenging validity of reassessment is accordingly dismissed.
6.4 The next ground is in respect of The next ground is in respect of merit of addit addition. Before us, the Ld. counsel for the assessee has filed an application under Rule the Ld. counsel for the assessee has filed an application under Rule the Ld. counsel for the assessee has filed an application under Rule 29 of the Income-tax Rules, 1962 (in short ‘the Rules’) for admitting tax Rules, 1962 (in short ‘the Rules’) for admitting tax Rules, 1962 (in short ‘the Rules’) for admitting the additional evidence. The relevant part of the application is the additional evidence. The relevant part of the application is the additional evidence. The relevant part of the application is reproduced as under: reproduced as under:
2. The circumst The circumstances which prevented the appellant from producing ances which prevented the appellant from producing the said documents before the Learned Assessing Officer ('Ld. A.O.') the said documents before the Learned Assessing Officer ('Ld. A.O.') the said documents before the Learned Assessing Officer ('Ld. A.O.') and the Ld. Commissioner of Income Tax (Appeals) ['Ld. CIT(A)'], and the Ld. Commissioner of Income Tax (Appeals) ['Ld. CIT(A)'], and the Ld. Commissioner of Income Tax (Appeals) ['Ld. CIT(A)'], during the course of proceedings before the said authorities are during the course of proceedings before the said authorities are during the course of proceedings before the said authorities are explained below: ned below:
Danco Enterprises India Pvt. Ltd. Danco Enterprises India Pvt. Ltd. 8 & 5023/MUM/2024 & 5023/MUM/2024
3. In 2017, the appellant company was incurring business losses 3. In 2017, the appellant company was incurring business losses 3. In 2017, the appellant company was incurring business losses and the bank account of the company was overdrawn and declared and the bank account of the company was overdrawn and declared and the bank account of the company was overdrawn and declared as Non-Performing Asset. A notice was also issued on the company Performing Asset. A notice was also issued on the company Performing Asset. A notice was also issued on the company under Securitisation and Reconstruction of Financial under Securitisation and Reconstruction of Financial under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SARFAESI Act'). Accordingly, Enforcement of Security Interest Act (SARFAESI Act'). Accordingly, Enforcement of Security Interest Act (SARFAESI Act'). Accordingly, the appellant company was occupied in complying with banking the appellant company was occupied in complying with banking the appellant company was occupied in complying with banking irregularities and other proceedings. irregularities and other proceedings.
Further, the relevant financial records and documents of the 4. Further, the relevant financial records and documents of the 4. Further, the relevant financial records and documents of the appellant compa appellant company for the year under consideration were scattered ny for the year under consideration were scattered due to the various ongoing proceedings before various due to the various ongoing proceedings before various authorities.
In 2021 5. In 2021-2022, when the impugned assessment proceedings 2022, when the impugned assessment proceedings were ongoing, the appellant company did not have its financial were ongoing, the appellant company did not have its financial were ongoing, the appellant company did not have its financial records and records and documents relating to A.Y. 2017-18 on hand 18 on hand and accordingly, it could not adequately reply to the notices issued. accordingly, it could not adequately reply to the notices issued. accordingly, it could not adequately reply to the notices issued. 6. Even during the pendency of the appeal before the Ld. CIT(A), 6. Even during the pendency of the appeal before the Ld. CIT(A), 6. Even during the pendency of the appeal before the Ld. CIT(A), the appellant was unable to locate its relevant financial records and the appellant was unable to locate its relevant financial records and the appellant was unable to locate its relevant financial records and documents and therefore, could not produce the same before the Ld. uments and therefore, could not produce the same before the Ld. uments and therefore, could not produce the same before the Ld. CIT(A). 7. Recently, on completion of the other proceedings before 7. Recently, on completion of the other proceedings before 7. Recently, on completion of the other proceedings before authorities, the appellant was able to collate its records and authorities, the appellant was able to collate its records and authorities, the appellant was able to collate its records and documents for F.Y. 2016 documents for F.Y. 2016-17, relevant to A.Y. 2017-18. 8. Accordingly, Accordingly, Accordingly, the the the appellant appellant appellant has has has compiled compiled compiled the the the following following following documentary evidences in a paperbook, which it would like to documentary evidences in a paperbook, which it would like to documentary evidences in a paperbook, which it would like to submit in the form of additional evidence before the Hon'ble IT AT: submit in the form of additional evidence before the Hon'ble IT AT: submit in the form of additional evidence before the Hon'ble IT AT: Sr. No. Particulars Page No. Whether available with lower authorities 1. ITR Acknowledgment and Computation of ITR Acknowledgment and Computation of 1-3 NO Income for A.Y. 2017 Income for A.Y. 2017-18 2. Notice u/s 148 of the Act, dated 31.03.2021 Notice u/s 148 of the Act, dated 31.03.2021 4 YES 3. Notices issued u/s 142(1) Notices issued u/s 142(1) 5-10 YES 4. Show cause notice dated 12.03.2022 Show cause notice dated 12.03.2022 11-13 YES 5. Reply to show cause notice filed Reply to show cause notice filed on 14-17 YES 17.03.2022 6. Details of Basant Marketing Limited Details of Basant Marketing Limited
Danco Enterprises India Pvt. Ltd. Danco Enterprises India Pvt. Ltd. 9 & 5023/MUM/2024 & 5023/MUM/2024 a. Ledger Account a. Ledger Account 18-19 NO b. Purchase Invoices and Delivery Note b. Purchase Invoices and Delivery Note 20-31 NO c. Bank Statement reflecting payment to c. Bank Statement reflecting payment to 32-36 NO purchase parties purchase parties 7. One to one mapping of alleged bogus one mapping of alleged bogus 37 NO purchase with corresponding sales purchase with corresponding sales
Therefore, considering facts and circumstances of the case, your Therefore, considering facts and circumstances of the case, your Therefore, considering facts and circumstances of the case, your Honours are requested to kindly admit the additional evidences, Honours are requested to kindly admit the additional evidences, Honours are requested to kindly admit the additional evidences, which are important and plays a vital role in which are important and plays a vital role in disposing the present disposing the present appeal in hand. appeal in hand.
The provision of Rule 29 of of the Income 10. The provision of Rule 29 of of the Income-tax (Appellate Tribunal) tax (Appellate Tribunal) Rules, 1963 are reproduced as under: Rules, 1963 are reproduced as under: "Production of additional evidence before the Tribunal. "Production of additional evidence before the Tribunal. 29. The parties to the appeal shall not be entitled to 29. The parties to the appeal shall not be entitled to 29. The parties to the appeal shall not be entitled to produce additional evidence either oral or documentary before the Tribunal, additional evidence either oral or documentary before the Tribunal, additional evidence either oral or documentary before the Tribunal, but if the Tribunal requires any document to be produced or any but if the Tribunal requires any document to be produced or any but if the Tribunal requires any document to be produced or any witness to be examined or any affidavit to be filed to enable it to witness to be examined or any affidavit to be filed to enable it to witness to be examined or any affidavit to be filed to enable it to pass orders or for any other substantial cause, pass orders or for any other substantial cause, or , if the income or , if the income-tax authorities have decided the case without giving sufficient authorities have decided the case without giving sufficient authorities have decided the case without giving sufficient opportunity to the assessee to adduce evidence either on points opportunity to the assessee to adduce evidence either on points opportunity to the assessee to adduce evidence either on points specified by them or not specified by them, the Tribunal, for reasons specified by them or not specified by them, the Tribunal, for reasons specified by them or not specified by them, the Tribunal, for reasons to be recorded, may allow such documen to be recorded, may allow such document to be produced or witness t to be produced or witness to be examined or affidavit to be filed or may allow such evidence to to be examined or affidavit to be filed or may allow such evidence to to be examined or affidavit to be filed or may allow such evidence to be adduced."
The right of the Hon'ble Tribunal to admit additional evidence in 11. The right of the Hon'ble Tribunal to admit additional evidence in 11. The right of the Hon'ble Tribunal to admit additional evidence in accordance with Rule 29 of the Income Tax Appellate Tribunal accordance with Rule 29 of the Income Tax Appellate Tribunal accordance with Rule 29 of the Income Tax Appellate Tribunal Rules, has fal Rules, has fallen for consideration before a Division Bench of len for consideration before a Division Bench of Madras Court in the case of CITv. Ku. Pa. Krishnan [2012] 345 ITR Madras Court in the case of CITv. Ku. Pa. Krishnan [2012] 345 ITR Madras Court in the case of CITv. Ku. Pa. Krishnan [2012] 345 ITR 38/25 taxmann.com 130 (Mad.). It has considered the matter and taxmann.com 130 (Mad.). It has considered the matter and taxmann.com 130 (Mad.). It has considered the matter and found that when Rule 18(4) is read with Rule 29 of the found that when Rule 18(4) is read with Rule 29 of the found that when Rule 18(4) is read with Rule 29 of the aforementioned Rules, t aforementioned Rules, there would not be any difficulty in holding here would not be any difficulty in holding that in terms of Rule 29, the additional evidence can also be terms of Rule 29, the additional evidence can also be terms of Rule 29, the additional evidence can also be produced before the Tribunal. produced before the Tribunal. 12. As can be seen from the peculiar facts of the present case the 12. As can be seen from the peculiar facts of the present case the 12. As can be seen from the peculiar facts of the present case the appellant had a bonafied reason to not file the afore appellant had a bonafied reason to not file the aforesaid additional said additional evidence before the lower authorities. It is therefore, a humble evidence before the lower authorities. It is therefore, a humble evidence before the lower authorities. It is therefore, a humble prayer of the appellant to kindly admit the additional evidence. prayer of the appellant to kindly admit the additional evidence. prayer of the appellant to kindly admit the additional evidence.”
Danco Enterprises India Pvt. Ltd. Danco Enterprises India Pvt. Ltd. 10 & 5023/MUM/2024 & 5023/MUM/2024 6.5 In view of the circumstances referred by the assessee in the In view of the circumstances referred by the assessee in the In view of the circumstances referred by the assessee in the application as well as in view of fact that application as well as in view of fact that documents filed are documents filed are crucial for determination of the issue in dispute involved in the crucial for determination of the issue in dispute involved in the crucial for determination of the issue in dispute involved in the grounds related to merit grounds related to merit, therefore, we feel it appropriate to restore therefore, we feel it appropriate to restore this issue back to the file of the Assessing Officer for deciding afresh this issue back to the file of the Assessing Officer for deciding afresh this issue back to the file of the Assessing Officer for deciding afresh in the light of the evidences filed by the assessee before us. The in the light of the evidences filed by the assessee before us. The in the light of the evidences filed by the assessee before us. The ground challenging merit of the addition i.e. ground No. 2 of the ground challenging merit of the addition i.e. ground No. 2 of the ground challenging merit of the addition i.e. ground No. 2 of the appeal is restored back to the file of the Assessing Officer for al is restored back to the file of the Assessing Officer for al is restored back to the file of the Assessing Officer for deciding afresh.
In the assessment year 2017 In the assessment year 2017-18 in 18 in also identical grounds have been raised except change of amount also identical grounds have been raised except change of amount also identical grounds have been raised except change of amount and therefore the grounds raised in assessment year 2017-18 are and therefore the grounds raised in assessment year 20 and therefore the grounds raised in assessment year 20 also decided mutatis mutandis. also decided mutatis mutandis.
In the result, both the appeals of the assessee are allowed for In the result, both the appeals of the assessee are allowed for In the result, both the appeals of the assessee are allowed for statistical purposes.