M/S ASHOK SHRICHAND DARYANI (HUF), AKOLA V. PRINCIPAL COMMISSIONER OF INCOME TAX -1, NAGPUR

ITA 110/NAG/2018

AI Insights

The case involves an appeal by M/s. Ashok Shrichand Daryani (HUF) against the order of the Pr.CIT, Nagpur-1, which was passed under section 263 of the Income-tax Act, 1961. The Pr.CIT's order was based on the grounds that the Assessing Officer did not properly examine the Hawala purchase bills totaling Rs.2,08,20,445 from five parties during the reassessment proceedings for the assessment year 2011-12. The Tribunal examined the submissions and evidence presented, including the assessee's replies and the documents verified by the Assessing Officer, and concluded that the reassessment was conducted properly, with no additions required regarding the purchases from the fifth party and no transactions with the first four parties.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 301444 (ITAT-NAGPUR)
• Duration Of Justice: 5 year(s) 2 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-07-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 25-07-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 10-05-2018
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Accommodation entries

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH (At e- Court, Pune) BEFORE SHRI R.S.SYAL, VICE PRESIDENT AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER आयकर अपील सं. /ITA No.110/Nag/2018 नधा रण वष / Assessment Year : 2011-12 M/s. Ashok Shrichand Daryani (HUF), Prop. of Haremadhav Trading Company, Sadguru Tower, Akola – 444 001 Maharashtra PAN : AAEHA8238G Vs. Pr.CIT-1, Nagpur Appellant Respondent Assessee by : Shri K.P. Dewani Revenue by : Shri Maurya Pratap स ु नवाई क तार ख / Date of Hearing : 26.07.2023 घोषणा क तार ख / Date of Pronouncement : 27.07.2023 आदेश / ORDER PER R.S.SYAL, VP: This appeal by the assessee is directed against the order dated 27-02-2018 passed by the ld. Pr.CIT, Nagpur-1 u/s.263 of the Income- tax Act, 1961 (hereinafter also called ‘The Act’) in relation to the assessment year 2011-12. 2. Briefly stated, the facts of the case are that action u/s.147 was taken on the ground that the assessee obtained Hawala purchase bills from 5 parties totaling to Rs.2,08,20,445/-. The assessment was 2 ITA No.110/Nag/2018 M/s. Ashok Shrichand Daryani (HUF) completed u/s.143(3) r.w.s.147 on 26-12-2016 in which no addition was made on this score. The ld. Pr.CIT held that the assessment order was erroneous and prejudicial to the interest of the Revenue because the Assessing Officer (AO) did not examine this issue. Aggrieved thereby, the assessee has come up in appeal before the Tribunal. 3. Having heard the rival submissions and gone through the relevant material on record, it is seen that undoubtedly the AO initiated reassessment proceedings on the ground that the assessee recorded Hawala purchases from the following parties: Name Amount (in Rs.) 1.Jai Enterprises 49,12,689/- 2.Pink Lotus Trade India Pvt. Ltd. 39,76,939/- 3. Salibhadra Multi Trade (I) Pvt. Ltd. 39,76,939/- 4. Shreyanjali Multi Trade Pvt. Ltd. 39,76,939/- 5. Classic Enterprises 39,76,939/- Total 2,08,20,445/- 4. During the course of assessment proceedings, the AO issued notice on 06-10-2016, inquiring, inter alia, about these transactions and also requiring the assessee to furnish necessary evidences in support of the genuineness of purchases. The assessee gave its reply which was received by the AO on 24-10-2016, a copy of which has been placed at page 8 onwards of the paper book. In such reply, it was submitted that the assessee did not make any purchase from the first 4 3 ITA No.110/Nag/2018 M/s. Ashok Shrichand Daryani (HUF) parties as recorded in the reasons for initiation of reassessment proceedings. As regards the last party, namely, Classic Enterprises, the assessee submitted that purchases were made from this party. Apart from purchase vouchers, the assessee also furnished transport builtis in respect of these purchases to show that these were genuinely purchased and received at its business premises. The AO, on the basis of such evidences, got satisfied and also discussed the issue in the assessment order. In para 3 of his order, the AO recorded that the assessee was called upon to produce books of accounts, bills/vouchers of purchases and sales. The same were produced by the assessee and duly verified on test check basis. In next para, namely, para 4, the AO, further recorded that the assessee “furnished purchase register along with purchase bills and transportation details”, which were verified by him and found to be correct. As against this, the ld. Pr. CIT revised the order on the ground that: `The order was passed without due verification of the above information’, namely, accommodation entries were obtained from the five parties. It is, therefore, evident that the initiation of revision proceedings on this score is not valid. Not only, no such transactions were entered into with the first 4 parties, the genuineness of the 5 th party, whose purchases were recorded, was also substantiated with relevant purchase bills and transportation details. 4 ITA No.110/Nag/2018 M/s. Ashok Shrichand Daryani (HUF) Such details were produced before the AO, who recorded this fact in the assessment order and also the correctness of the assessee’s claim. In this backdrop of the facts of the case, it is manifest that the assessment order cannot be construed as erroneous much less prejudicial to the interest of the Revenue. We, therefore, overturn the impugned order. 5. In the result, the appeal is allowed. Order pronounced in the Open Court on 27 th July, 2023. Sd/- Sd/- (S.S. VISWANETHRA RAVI) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT प ु णे / Pune; दनांक / Dated : 27 th July, 2023 Satish आदेश क त ल प अ े षत / Copy of the Order forwarded to : 1. अपीलाथ / The Appellant. 2. !यथ / The Respondent. 3. The Pr.CIT, Nagpur-1 4. "वभागीय त न%ध, आयकर अपील य अ%धकरण, “नागप ु र” ब ' च, / DR, ITAT, “Nagpur” Bench 5. गाड फ़ाइल / Guard File. // True Copy // आदेशान ु सार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपील य अ%धकरण, प ु णे / ITAT, Pune 5 ITA No.110/Nag/2018 M/s. Ashok Shrichand Daryani (HUF) * Date 1. Draft dictated on 26-07-2023 Sr.PS 2. Draft placed before author 27-07-2023 Sr.PS 3. Draft proposed & placed before the second member JM 4. Draft discussed/approved by Second Member. JM 5. Approved Draft comes to the Sr.PS/PS Sr.PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order.