INCOME TAX OFFICER-17(1)(1),MUMBAI, MUMBAI vs. ANANTAM, MUMBAI

4. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) was not justified in deleting the addition made by the Assessing Officer in the light of the recent decision of the Hon'ble Bombay High Court in Drisha Impex Pvt. Ltd. in of 2018 with of 2018 dated 07.04 2025 and Kanak Impex (India) Ltd in of 2021 dated 03.03.2025.

5. The appellant craves the leave to add, substitute, modify, alter, DLEETE OR amend any ground of appeal either before OR at the time of hearing.”

& 8819/Mum/2025 M/s. Anantam Impex and the same was neither controverted by the Ld. AO nor conducted any independent enquiry to verify the genuineness of the purchase and sales made by the assessee.

Ltd. (2025) 474 ITR 0175 and further reiterated that the issue be remanded back to Ld. AO for proper verification of the documentary evidences submitted by the assessee and also relied on the order of the Ld. AO.

The Ld. AR further stated that the Ld. AO has not verified the documents submitted by the & 8819/Mum/2025 M/s. Anantam assessee neither has issued notice u/s 133(6) of the Act to the impugned suppliers and has also not conducted any independent enquiry for verifying whether any business activity was carried out by M/s. R.K. Impex. The Ld. AR argued that the Ld. AO has neither disputed the corresponding sales nor rebutted the documents filed by the assessee. The Ld. AR placed reliance on the decision of the Tribunal in assessee’s own case for A.Y. 2016- 17 where on identical facts the purchases made with M/s. R.K. Impex was held to be genuine. The Ld. AR relied on the order of the Ld. CIT(A).

The issue that requires adjudication is whether the purchases made by the assessee from M/s. R.K. Impex was merely a bogus transaction and whether the assessee has duly established the genuineness by cogent documentary evidences to establish its claim. It is observed that the Ld. AO has reopened the assessee’s case based on some information that the assessee has availed accommodation entry by way of bogus purchases from M/s. R.K.

Impex where the modus operandi was that the purchases will be made by cheque and later cash will be received for which M/s. R.K. Impex, alleged to be an accommodation entry provider, which would receive certain percentage as commission for such transaction.

Though the Ld. AO has specified that the assessee has furnished copies of “financial accounts” no details as to what were the documents submitted and how those documents are not sufficient to prove the genuineness of the transaction were not explained at length by the Ld. AO, who had merely stated that the assessee has failed to prove the genuineness of the transaction and since the Department has concrete information that assessee was one of the beneficiaries of accommodation entry by way of bogus purchases, made the & 8819/Mum/2025 M/s. Anantam impugned addition. It is also evident that the Ld. AO has not specified as to whether or not notice u/s 133(6) of the Act was issued on the party through whom the assessee had made purchases and there are also no details pertaining to whether the Ld. AO had conducted any enquiry in the premises of the accommodation entry providers as to whether there is any actual business carried out by the said entity or not. The Ld. AO has failed to elaborate in detail as to how the assessee is beneficiary of the alleged accommodation entry.

When the provisions of the Act clearly mandate that when the assessee has incurred any expenditure and offers no explanation about the source of such expenditure or part thereof or the explanation is not to the satisfaction of the Assessing Officer then such expenditure is deemed to be the income of the assessee not allowable as deduction under any head of income. In the present case, the Ld. AO has categorically specified that the assessee has submitted copies of the final accounts etc. in support of its submission and had denied the transaction in question, the Ld. AO ought to have dealt with the documentary evidences filed by the assessee such as the copies of ledger confirmation of parties along with bank statement which the Ld. AO has recorded that the same was filed before him. The finding of the Ld. AO is on the basis of vague or general observation and not specific or evidence based finding without proper enquiry and linkage to the facts of the assessee’s case. The Ld. AO ought to have conducted a reasonable enquiry such as issuing notices to the alleged parties, examining whether the confirmation given by such parties are genuine, verifying the stock in sales along with the bank trial etc. to establish the fact that the purchases are bogus or inflated. We are conscious of the fact that various higher forums as well as the co-ordinate Benches have held that the standard evidences to prove the identity of the supplier, movement of goods along with payment trial has to be established by cogent & 8819/Mum/2025 M/s. Anantam documentary evidences pertaining to purchase documents, details of the supplier, delivery and movement of goods, bank statement etc. which has to be examined by the lower authorities pertaining to the genuineness of the said documents. In the present case in hand the assessee claims to have filed the documents before the lower authorities which was not discussed at length by the Ld. AO but considered by the Ld. CIT(A) who held the transaction to be genuine and pertinently the assessee has also filed voluminous document such as audited statement of accounts along with the tax audit reports, details of fabric purchases and sales party-wise, fabric purchase invoices, sales invoices, purchase ledger accounts, bank statement showing payments for fabric purchase, quantity-wise fabric purchase register and sales register along with various other documentary evidences before us. In the absence of any contrary finding as to the genuineness of the documentary evidences filed by the assessee, we do not find any infirmity in the order of the Ld. CIT(A).

Further, the decisions relied upon by the Revenue in the case of Kanak Impex India Ltd. (2025) 172 taxmann.com 283 (Bom.) and Drisha Impex Pvt. Ltd. (2025) 173 taxmann.com 571 (Bom.) by the Hon’ble Jurisdictional High Court are distinguishable on the facts where it was held that when the assessee had been non-cooperative and failed to furnish the substantial information to prove the genuineness of the purchases, the addition made u/s 69C of the Act was justified which is not the facts of the present case in hand where the assessee has filed all relevant details along with supporting documentary evidences to substantiate its claim. Therefore, we deem it fit to dismiss the grounds of appeal raised by the Revenue.

& 8819/Mum/2025 M/s. Anantam ITA No.8819/M/2025

115BBE of the Act along with addition of Rs.7,94,486/- towards commission expenses for availing accommodation entry by way of bogus purchases from three entities namely M/s.

R.K. Impex, M/s. R.M. Textiles, M/s. R.K. Traders, M/s. One World Industries Pvt. Ltd.

11. Based on the information received during the search and seizure action carried out in the case of M/s. One World Group entities dated 06.11.2019 the assessee’s case was reopened for the reason that the assessee was one of the beneficiaries of the accommodation entry provided by various entities. The Ld. AO observed that the assessee had purchased goods from the above mentioned entities alleged to be accommodation entry providers and during the assessment proceeding the assessee is said to have furnished ledgers, details of items purchased, details of payments made through banking channel along with sample invoice bills, sales register, sales invoices and purchase invoices. The Ld. AO sought for details of transportation of goods for which the assessee contended that its nature of business was such that the transportation cost was not paid by the assessee neither while selling nor while purchasing the goods. Further, the Ld. AO observed that in the sample purchase bills there were no signature of receipt of the products was seen which according to the Ld. AO are fabricated bills. The Ld. AO also relied on the statement of the parties recorded during the search who admitted that they were mere accommodation entry providers. The Ld. AO also disputed the transaction of sale with regard to some of the parties whose nature of business was completely different from that of the textile business & 8819/Mum/2025 M/s. Anantam and hence held the same to be not genuine. The Ld. AO also noted that the VAT return submitted by the assessee are revised returns and not original returns which were revised on 29.11.2018 and 30.11.2018 which was two years after the transaction of sale and purchase were made. Further, the Ld. AO observed that there was no sale in the month of April, August and October to December which is not like a regular business activity and the assessee has also not furnished the original VAT return and merely copy of the revised return was enclosed. The Ld. AO made an addition u/s 69C of the Act on the entire purchase value of Rs.7,94,48,640/- along with expenditure towards commission of 1% on the alleged bogus purchases. The Ld. CIT(A) deleted the impugned addition on the ground that the Ld. AO has failed to conduct any independent enquiry and has also not called for information from the alleged parties by issuing notice u/s 133(6) of the Act nor has it conducted any physical enquiry to examine the identity of the suppliers and buyers. The Ld. CIT(A) further held that the Ld. AO has merely relied on the information received from the Investigation Wing and beyond that there is no concrete evidence in support of the Revenue’s contention.

It is observed that the assessee, for the year under consideration, has filed documentary evidences along with written submission running to 436 pages which includes details of purchase and sale along with purchase invoices, purchase ledger accounts, bank statements and purchase and sale register. The Ld. AO has himself recorded the same but had specified certain discrepancies in the documents filed by the assessee and has also held that the assessee has not furnished the details of the transportation of goods, for which the & 8819/Mum/2025 M/s. Anantam assessee has contended that it has purchased goods on “landed in warehouse” terms where LRs are not received by them from the suppliers as per the trade practice where the assessee sale is on “Ex-warehouse” terms in which case the customer arranges for loading and pick up.

There is no iota of doubt that the assessee has discharged its onus of proving the fact that the purchases are genuine by cogent documentary evidences which ought to have been rebutted by the Assessing Officer, the failure to do so will benefit the assessee in holding that the Revenue has not controverted the assessee’s claim. The findings given by us in and hence on the said observation the grounds of appeal raised by the Revenue are hereby dismissed.

Order pronounced in the open court on 26.03.2026