B.M.INDUSTRIES,HOWRAH vs. I.T.O.,WARD-46(2), KOLKATA

It transpires at the outset that the Assessing Officer had framed his reassessment; ex parte, against the assessee whilst disallowing/adding its alleged bogus purchases of Rs.21,69,165/- from four parties namely M/s Durga Sales, M/s Rajputana Vanijya Pvt. Ltd., M/s Singh Mercantile Pvt. Ltd. & M/s Viwadhara Supply Syndicate involving sums of Rs.4,26,666/-, Rs.6,70,951/-, Rs.5,93,034/- & Rs.4,78,514/-; respectively on the ground that their authorized person one Sri Sanjiw Kumar Singh had deposed in the department’s search carried out on 05.07.2016 that he had been providing bogus purchase bills in the name of all four entities for deriving commission income. This made the Assessing Officer to disallow/add assessee’s foregoing purchase sums as bogus u/s 69C of the Act followed by commission @2% u/s 69C of the Act. The CIT(A)’s ex parte lower appellate order has confirmed the same.

We have given our thoughtful consideration to rival submissions. Learned counsel vehemently contends that both the lower authorities have erred in law and on facts in disallowing assessee’s genuine purchases from the four above-stated entities as bogus alongwith commission thereupon @2% despite the fact that the assessee’s corresponding sales have been taken as genuine. And also all the four alleged entry provider entities also stand assessed qua the purchase amounts under business head. The Revenue’s case, on the other hand, is that the Assessing Officer as well as the CIT(A) have rightly disallowed the assessee’s purchases. We find no reason to sustain the Revenue’s stand in entirety. As already indicated at the assessee’s behest, it has come on record that its income from corresponding sales has already been accepted during the course of assessment as correct. Meaning thereby the impugned purchases sought to be treated as bogus have been assessed as business income in case of all four parties as well as in assessee’s case. Coupled with this, we also find that neither the Assessing Officer nor the CIT(A) S.A No.27/Kol/2020 & B.M. Industries Assessment Year: 2011-12 have confronted the assessee with copy of the search statement of Mr. Singh right from the beginning also has nowhere indicated all purchase sums in its case as bogus. We therefore are of the view that all these factual aspect requires afresh verification from the Assessing Officer’s end. We order accordingly. The assessee’s sole substantive ground as well as its main appeal SA No.27/Kol/2020 is rendered infructuous.

Before parting, it is noted that the order is being pronounced after ninety