DHADDA GEM N JEWELS ,MUMBAI vs. ITO WARD19(1)(4), MUMBAI

This appeal has been preferred by the assessee against the order dated 13.01.2023 passed by the Ld. Commissioner of Income Tax (Appeals)-National Faceless Appeal Centre, Delhi [In short the Ld. CIT(A)] for assessment year 2012-13, raising sole ground reproduced as under:-

Briefly stated facts of the case are that the assessee had Briefly stated facts of the case are that the assessee had Briefly stated facts of the case are that the assessee had not filed the regular return of income for the year under not filed the regular return of income for the year under not filed the regular return of income for the year under consideration. Subsequently on receipt of information from the consideration. Subsequently on receipt of information from the consideration. Subsequently on receipt of information from the Director General of Income Tax (Investigation), Mumbai that the Director General of Income Tax (Investigation), Mumbai that the Director General of Income Tax (Investigation), Mumbai that the assessee had taken accommodation entries of bogus purchases d taken accommodation entries of bogus purchases d taken accommodation entries of bogus purchases from certain persons belonging to the from certain persons belonging to the ‘Rajendra Jain Rajendra Jain’ group, the assessment was reopened by way of ssment was reopened by way of issuing notice under issuing notice under section 148 of the Income Tax Act, 1961 (in short “the Act”). section 148 of the Income Tax Act, 1961 (in short “the Act”). section 148 of the Income Tax Act, 1961 (in short “the Act”).

In the reasons recor In the reasons recorded, the Assessing Officer recorded the Assessing Officer recorded that the assessee availed bogus purchase accommodat that the assessee availed bogus purchase accommodat that the assessee availed bogus purchase accommodation entries of Rs.2,37,92,781/ entries of Rs.2,37,92,781/-. During assessment proceedings, . During assessment proceedings, the Assessing Officer issued show cause notice to the assessee he Assessing Officer issued show cause notice to the assessee he Assessing Officer issued show cause notice to the assessee as to why the corresponding purchases might not be as to why the corresponding purchases might not be as to why the corresponding purchases might not be disallowed. However, the assessee did not file the relevant disallowed. However, the assessee did not file the relevant disallowed. However, the assessee did not file the relevant details except income tax return, computation and ledger details except income tax return, computation and ledger details except income tax return, computation and ledger account of concerned purc concerned purchase parties. The Assessing Officer parties. The Assessing Officer issued notices under section 133(6) of the Act on 20.11.2019 issued notices under section 133(6) of the Act on 20.11.2019 issued notices under section 133(6) of the Act on 20.11.2019 to those purchase parties those purchase parties but same remained non but same remained non-complied in most of the cases. most of the cases. In view of failure on the part of the assessee on the part of the assessee in discharging its in discharging its onus onus to subs to substantiate tantiate its concerned its concerned purchases, the Assessing Officer disallowed the corresponding the Assessing Officer disallowed the corresponding the Assessing Officer disallowed the corresponding purchases.

Before us, the Ld. Counsel for the assessee claimed that the Ld. Counsel for the assessee claimed that relevant details relevant details were filed before the Ld. CIT(A), however the filed before the Ld. CIT(A), however the Ld. CIT(A) upheld the findings Ld. CIT(A) upheld the findings of the Ld. Assessing Officer. Assessing Officer.

We have heard rival submissions of the parties and We have heard rival submissions of the parties and We have heard rival submissions of the parties and perused the relevant material on record. Before us perused the relevant material on record. Before us perused the relevant material on record. Before us, the Ld. Counsel for the assessee was asked Ld. Counsel for the assessee was asked to substantiate whether to substantiate whether required details/ /information were filed before the Ld. CIT(A) efore the Ld. CIT(A) and whether the same were in the nature of the additional and whether the same were in the nature of the additional and whether the same were in the nature of the additional evidence before him evidence before him, but the Ld. Counsel expressed his but the Ld. Counsel expressed his inability in producing so inability in producing so on the ground that those were not on the ground that those were not readily available. However, he submitted that in the year un . However, he submitted that in the year un . However, he submitted that in the year under consideration the assessee has not made any purchases in consideration the assessee has not made any purchases in consideration the assessee has not made any purchases in reference but same same were made/recorded by another company of by another company of the same group namely the same group namely M/s. Dhadda Gems Ltd. The Ld. M/s. Dhadda Gems Ltd. The Ld. Counsel filed a copy of the order of the Ld. First Appellate Counsel filed a copy of the order of the Ld. First Appellate Counsel filed a copy of the order of the Ld. First Appellate Authority in the case Authority in the case of the M/s. Dhadda Gems Ltd. of the M/s. Dhadda Gems Ltd.

In view of the facts and circumstances, we feel it In view of the facts and circumstances, we feel it In view of the facts and circumstances, we feel it appropriate to set aside the order of the Ld. CIT(A) on the issue appropriate to set aside the order of the Ld. CIT(A) on the issue appropriate to set aside the order of the Ld. CIT(A) on the issue in dispute and in dispute and restore the matter back to him for deciding ack to him for deciding afresh. If the evidences to be filed before f the evidences to be filed before the Ld. CIT(A) are in the Ld. CIT(A) are in the nature of additional evidence the nature of additional evidences, then the assessee may file then the assessee may file application under rule 46A of the Income Tax Rules, 1962 and application under rule 46A of the Income Tax Rules, 1962 and application under rule 46A of the Income Tax Rules, 1962 and the Ld. CIT(A) may decide admission of the those additional the Ld. CIT(A) may decide admission of the those additional the Ld. CIT(A) may decide admission of the those additional evidences in accordance with law. evidences in accordance with law. The Ld. CIT(A) Ld. CIT(A) may verify the M/s. Dhadda Gem N. Jewels M/s. Dhadda Gem N. Jewels ITA No.662/MUM/2023 claim of the assessee of purchases debited in the hands of the claim of the assessee of purchases debited in the hands of the claim of the assessee of purchases debited in the hands of the assessee or in hands of other hands of other company and then decide the company and then decide the issue of disallowance of the purchases in accordance with law issue of disallowance of the purchases in accordance with law issue of disallowance of the purchases in accordance with law, after after after providing providing providing adequate adequate adequate opportunity opportunity opportunity of of of being being being heard. heard heard Accordingly, the sole ground raised by the assessee is allowed the sole ground raised by the assessee is allowed the sole ground raised by the assessee is allowed for statistical purchases. for statistical purchases.

In the result, the appeal of the assessee is allowed for In the result, the appeal of the assessee is allowed for In the result, the appeal of the assessee is allowed for statistical purposes. statistical purposes.