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Income Tax Appellate Tribunal, ‘D’ BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI S. JAYARAMAN
आदेश /O R D E R
PER N.R.S. GANESAN, JUDICIAL MEMBER:
All the three appeals of the assessee are directed against the common order passed by the Commissioner of Income Tax (Appeals) -3, Chennai, dated 30.08.2017 and pertain to assessment years 2008-09 and 2009-10. Since common issue arises for consideration is in all these appeals, we heard these appeals together and disposing of the same by this common order.
Sh. T. Banusekar, the Ld. representative for the assessee, submitted that for the assessment year 2008-09, the assessee has filed two appeals. relates to appeal against assessment passed under Section 143(3) read with Section 147 of the Income-tax Act, 1961 (in short 'the Act'). I.T.A. No.2936/Chny/2017 arises out of the order passed by the Assessing Officer under Section 154 of the Act.
Sh. T. Banusekar, the Ld. representative for the assessee, submitted that on the issues arise for consideration in the first issue is regarding reopening of assessment and the second issue is with regard to addition of ₹40,66,090/- as bogus purchases. According to the Ld. representative, even though the assessment was reopened beyond four years, the Assessing Officer has not disposed of the objection of the assessee for reopening. Referring to the addition made by the Assessing Officer on merit, the Ld. representative submitted that the Assessing Officer mainly placed her reliance on the report said to be received from the Investigation Wing of the Department at Mumbai. The Ld. representative further submitted that the investigation report was not furnished to the assessee.
Sh. T. Banusekar, the Ld. representative for the assessee, submitted that in the issue relates to levy of interest under Section 234A and 234B of the Act, which is consequential. Therefore, according to the Ld. representative, both the appeals of the assessee for assessment year 2008-09 may be remitted back to the file of the Assessing Officer.
Now coming to the assessment year 2009-10, the Ld. representative for the assessee submitted that here also the issue arises for consideration on merit is regarding bogus purchases.
According to the Ld. representative, the assessment was reopened on the basis of investigation report said to be received from Mumbai. The copy of investigation report was not furnished to the assessee, therefore, the Ld. representative prayed that the Assessing Officer may be directed to furnish a copy of the investigation report and decide the issue on merit.
We heard Dr. S. Pandian, the Ld. Departmental Representative also. According to the Ld. D.R., there were bogus purchases. It came to the notice of the Assessing Officer from the report received from the Investigation Wing of the Department at Mumbai. According to the Ld. D.R., one Shri Rajendra Jain, who was name lender, was examined. The said Shri Rajendra Jain identified the assessee-company along with the amount of bogus purchases as the beneficiary of accommodation entry provided to them. Therefore, according to the Ld. D.R., the Assessing Officer has rightly reopened the assessment on the basis of the report of the Investigation Wing of the Department at Mumbai. On a query from the Bench whether the copies of investigation report of the Department at Mumbai were furnished to the assessee? the Ld. D.R. submitted that there was no reference about furnishing the copies of investigation report to the assessee in the impugned order of the Assessing Officer as well as the CIT(Appeals).
We have considered the rival submissions on either side and perused the relevant material available on record. The Assessing Officer reopened the assessment after issuing notice under Section 148 of the Act on the basis of the report / information said to be received from the Investigation Wing of the Department at Mumbai.
This report is the base for making addition. However, the said report was not furnished to the assessee. This Tribunal is of the considered opinion that when the Assessing Officer placed her reliance on the investigation report said to be received from the Investigation Wing of the Department at Mumbai, copy of the same should be furnished to the assessee so that the assessee may respond to the report by filing necessary reply. Since such an action was not taken by the Assessing Officer, this Tribunal is of the considered opinion that there is a clear violation of principles of natural justice. Accordingly, orders of both the authorities below are set aside in all the three appeals of the assessee and the entire issue raised by the assessee is remitted back to the file of the Assessing Officer. The Assessing Officer shall re-examine the matter after furnishing copies of the investigation report said to be received from the Investigation Wing of the Department at Mumbai and thereafter decide the issue afresh in accordance with law, after giving a reasonable opportunity to the assessee.
In the result, all the appeals filed by the assessee are allowed for statistical purposes.
Order pronounced in the court on 1st August, 2019 at Chennai.