VIPUL H DOSHI (HUF) PROP. POOJA ENTERPRISES,MUMBAI vs. INCOME TAX OFFICER 27(3)(5), MUMBAI

The common dispute in all these appeals is in relation to the additions made on account of non–genuine purchases.

Briefly the facts are, for the impugned assessment years, the assessee filed its returns of income in regular course under section 139(1) of the Income Tax Act, 1961 (for short “the Act”). The returns of income filed by the assessee were processed under section 143(1) of the Act. Subsequently, on the basis of information received from DGIT (Inv.), Mumbai, and Sales Tax Department, Government of Maharashtra, that certain purchases claimed to have been made by the assessee in the impugned assessment years are non–genuine, the Assessing Officer re–opened the assessment under section 147 of the Act in all the assessment years under appeal. As observed by the Assessing Officer, the information available on record indicated that certain purchases made by the assessee were non–genuine as they were effected from parties who have been identified as hawala operators providing accommodation bills only. The details of such purchases in different assessment years are as under:–

As observed by the Assessing Officer, though, the assessee was time and again called upon to appear and produce supporting documentary evidences to prove the genuineness of purchases made, however, the assessee neither appeared nor produced the required evidences. Further, the independent enquiry conducted by the Assessing Officer to ascertain the genuineness of purchases also was unsuccessful as the notices issued under section 133(6) of the Act to the selling dealers returned back un–served. Since, the assessee did not appear in the course of assessment proceedings, the Assessing Officer proceeded to complete the assessment for the impugned assessment years ex–parte, to the best of his judgment, by invoking the provisions of section 144 of the Act. Ultimately, the Assessing Officer completed the assessment for the impugned assessment years under section 144 r/w section 147 of the Act by disallowing the non– genuine purchases and adding them back to the income of the assessee. Against the additions so made, the assessee preferred appeals before the first appellate authority. Since, before learned Commissioner (Appeals) also the assessee did not appear, the appeals were decided ex–parte by upholding the additions made by the Assessing Officer.

We have considered rival submissions and perused material on record. The only submission made by the learned Authorised

Though, learned Departmental Representative justified the action of the learned Commissioner (Appeals) in deciding the appeals ex– parte, however, he had no serious objection if the assessee is granted one more opportunity to represent its case before the learned Commissioner (Appeals).

Having considered rival submissions, we have noticed that the assessee has defaulted in appearing before the departmental authorities in the course of proceedings before them. Therefore, the assessment orders as well as first appeal orders were passed ex– parte. However, considering the submissions of the learned Authorised Representative that given an opportunity the assessee would diligently represent its case before learned Commissioner (Appeals), we are inclined to take a lenient view and restore the issues raised in the 5 Vipul H. Doshi (HUF)

In the result, appeals are allowed for statistical purposes. Order pronounced in the open Court on 20.03.2019