NEHAL CORPORATION,MUMBAI vs. ITO WD 16(3)(2), MUMBAI

At the time of hearing, it was noticed that in spite of service of notice of hearing by registered post, none appeared on behalf of the appellant assessee. Accordingly, following Rule 24 of Income-tax (Appellate Tribunal) Rules, 1963, the appeal of the assessee is being disposed of ex-parte qua the appellant, after hearing Ld. Departmental Representative on merit.

In brief, the relevant facts are that the assessee is a partnership firm engaged in the business of trading in automobile spares and bearings. In the assessment order, Assessing Officer has noted that a survey action under section 133A of the Act was carried out in the premises of the assessee simultaneously with a search action at the residence of Shri Rajnikant S. Janani and associated group cases on 14/02/2001. The facts relevant for the present purpose are that purchases to the tune of Rs.4,96,500/- made from three parties namely Meit Enterprises, M.K.Enterprises and Vijay Sales Corporation have been held to be unproved. The CIT(A) has concluded that assessee has obtained bogus bills from such parties with the object of inflating the purchases and suppression of true profits. The finding of the CIT(A) is after taking into consideration the fact that on an earlier occasion the matter had travelled to the Tribunal, which had set-aside the issue for fresh adjudication. The CIT(A) also notes that the Assessing Officer in the remand report had accepted the purchases from five parties, as verifiable and to that extent the CIT(A) deleted the addition. Only in relation to the aforesaid three parties, the CIT(A) affirmed the addition by noticing that assessee had failed to discharge the burden cast upon it.