Nitin Ramdeoji Lohia, Nashik V. Income-tax Officer,

ITA 1367/PUN/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9206 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 8 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-07-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 19-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus purchase; Business income
• Section: 143(3); 133(6); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO S . 1365 TO 1367 /P U N/201 5 / ASSESSMENT YEARS : 2009 - 10 TO 2011 - 12 SHRI NITIN RAMDEOJI LOHIA, PROP. M/S. KARAN ENTERPRISES, 2A, YADUKUL CO - OP. HOUSING SOCIETY, GANGAPUR ROAD, NASHIK 422005 . / APPELLANT PAN: AB DPL1394A VS. THE INCOME TAX OFFICER, WARD 1(5), NASHIK . / RESPONDENT . / ITA NO S . 1407 TO 1409 /PUN/201 5 / ASSESSMENT YEAR S : 200 9 - 10 TO 2011 - 12 THE INCOME TAX OFFICER, WARD 1(5), NASHIK . / APPELLANT VS. SHRI NITIN RAMDEOJI LOHIA, PROP. M/S. KARAN ENTERPRISES, 2A, YADUKUL CO - OP. HOUSING SOCIETY, GANGAPUR ROAD, NASHIK 422005 . / RESPONDENT PAN: ABDPL1394A ASSESSEE BY : S HRI SANKET JOSHI REVENUE BY : S HRI AJAY MOD I / DATE OF HEARING : 29 .0 6 . 201 7 / DATE OF PRONOUNCEMENT: 05 . 0 7 .201 7 ITA NO S . 1365 TO 1367 /P U N/20 1 5 ITA NOS.1407 TO 1409/PUN/2015 SHRI NITIN RAMDEOJI LOHIA 2 / ORDER PER SUSHMA CHOWLA, J M : ALL T HE THREE CROSS - APPEALS FILED BY THE ASSESSEE AND THE REVENUE ARE AGAINST SEPARATE ORDERS OF CIT(A) - 1, NASHIK, ALL DATED 18.08.2015 RELATING TO ASSESSMENT YEAR S 200 9 - 10 TO 2011 - 12 PASSED AGAINST RESPECTIVE ORDER S UNDER SECTION 143(3) R.W.S.14 7 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). 2. THESE CROSS - APPEALS FILED BY THE ASSESSEE AND THE REVENUE REL ATING TO ASSESSMENT YEARS 2009 - 10 TO 2011 - 12 ON SIMILAR ISSUE WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 3. THE ISSUE ARIS ING IN THE PRESENT BUNCH OF APPEALS IS THE ADDITION MADE ON ACCOUNT OF A LLEGED HAWALA PURCHASES. THE FACTS AND ISSUES ARISING IN THE PRESENT BUNCH OF APPEALS ARE IDENTICAL. HOWEVER, FOR THE SAKE OF DECIDING THE ISSUE, REFERENCE IS BEING MADE TO THE FACTS AND ISSUE IN ITA NOS.1365/PUN/2015 & 1407/PUN/2015. 4 . THE ASSESSEE IN ITA NO. 1365 /PUN/201 5 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - ON FACTS AND IN LAW, 1] THE LEARNED CIT(A) ERRED IN PARTLY CONFIRMING THE DISALLOWANCE MADE BY THE A.O. ON ACCOUNT OF PURCHASES MADE FROM THREE ALLEGED HAWALA PARTIES ON THE BASIS OF INFORMATION OBTAINED FROM MAHARASHTRA SALES TAX DEPT. 2] THE LEARNED CIT(A) ERRED IN HOLDING THAT THE GROSS PROFIT RATE ON THE ALLEGED HAWALA PURCHASES OF RS.2,45,93,371/ - MADE FROM THE ABOVE PARTIES WAS TO BE CONSIDERED @ 5 % AS AGAINST 0.69 % DECLARED BY THE ASSESSEE AND THEREBY CONFIRMING THE ADDITION OF RS.10,59,974/ - . ITA NO S . 1365 TO 1367 /P U N/20 1 5 ITA NOS.1407 TO 1409/PUN/2015 SHRI NITIN RAMDEOJI LOHIA 3 3] THE LEARNED CIT(A) FAILED TO APPRECIATE THAT THE ENTIRE PURCHASES MADE BY THE ASSESSEE FROM THE THREE PARTIES WERE GENUINE AND THE SAME WERE DULY SUPPORTED BY DOCUMENTARY EVIDE NCES AND HENCE, IN THE ABSENCE OF ANY CONTRARY EVIDENCE BROUGHT ON RECORD BY THE DEPT., NO DISALLOWANCE WAS WARRANTED ON FACTS OF THE CASE. 4] THE LEARNED CIT(A) OUGHT TO HAVE APPRECIATED THAT - A . THE ALLEGED HAWALA SUPPLIERS HAD GIVEN COUNTERS AFFIDAV ITS STATING THE FACT THAT ALL THE SALES MADE TO THE ASSESSEE IN THIS YEAR WERE GENUINE AND THAT THE SALES TAX DEPT. HAD OBTAINED THEIR STATEMENTS UNDER FORCE & PRESSURE. B . ALL THE SAID SUPPLIERS WERE REGISTERED UNDER MVAT ACT AND THEY WERE DULY FILING VAT R ETURNS AND CONSIDERING THE SAID FACTS AND AFFIDAVIT SUBMITTED BY THESE PARTIES, EVEN THE SALES TAX DEPT. HAD GRANTED STAY TO THE VAT LIABILITY RAISED IN THE CASE OF THE ASSESSEE IN RESPECT OF THE SAID PURCHASES MADE FROM THESE PARTIES. C . THE LEARNED A.O./ C IT(A) HAD NOT CONTROVERTED THE AFFIDAVITS FILED BY THESE SUPPLIERS AND HENCE, IN THE ABSENCE OF ANY CONTRARY EVIDENCE, WHATSOEVER, BROUGHT ON RECORD BY THE DEPT. TO DOUBT THE GENUINENESS OF THE SAID PURCHASES, THERE WAS NO REASON TO MAKE ANY ADDITION IN RE SPECT OF THE SAID PURCHASES. 5] THE LEARNED CIT(A) ERRED IN NOT APPRECIATING THAT - A . THE ASSESSEE HAD DULY MAINTAINED STOCK REGISTER IN RESPECT OF THE PURCHASES AND SALES MADE DURING THIS YEAR AND SINCE THE A.O./ CIT(A) HAD NOT FOUND ANY DEFECT WITH TH E SAID QUANTITATIVE RECORD MAINTAINED BY THE ASSESSEE, THERE WAS NO REASON TO MAKE ANY ADHOC - ADDITION IN RESPECT OF SUCH PURCHASES. B . ALL THE PAYMENTS TO THESE PARTIES WERE MADE THROUGH ACCOUNT PAYEE CHEQUES AND HENCE, THE GENUINENESS OF THE PURCHASES MADE FROM THE ABOVE PARTIES SHOULD NOT HAVE BEEN DOUBTED. C . THE A.O. HAS NOT BROUGHT ANY EVIDENCE ON RECORD TO SHOW THAT THE CHEQUE PAYMENTS MADE BY THE ASSESSEE TO THE VARIOUS SUPPLIERS WERE WITHDRAWN BY THEM IN CASH AND GIVEN BACK TO THE ASSESSEE AND HENCE, IN THE ABSENCE OF ANY SUCH EVIDENCE SUGGESTING NON GENUINENESS OF PURCHASES, THERE WAS NO REASON TO MAKE ANY DISALLOWANCE IN RESPECT OF THESE PURCHASES. 6] WITHOUT PREJUDICE, THE ASSESSEE SUBMITS THAT THE GROSS PROFIT ESTIMATED @ 5 % ON ALLEGED HAWALA PU RCHASES IS VERY HIGH CONSIDERING THE NATURE OF BUSINESS OF THE ASSESSEE AND IF AT ALL, ANY ADDITION IS TO BE SUSTAINED, THE SAME MAY BE REDUCED SUBSTANTIALLY. 5 . THE REVENUE IN ITA NO.1407/PUN/2015 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - ITA NO S . 1365 TO 1367 /P U N/20 1 5 ITA NOS.1407 TO 1409/PUN/2015 SHRI NITIN RAMDEOJI LOHIA 4 I ) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) - 1, NASHIK WAS JUSTIFIED IN DELETING THE ADDITION OF RS.2,45,93,371/ - ON ACCOUNT OF ALLEGED BOGUS PURCHASES FROM HAWALA DEALERS / PARTIES ? II ) WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE TH E CIT(A) WAS JUSTIFIED IN DELETING THE PURCHASES TREATED AS BOGUS WHEN THE APPELLANT HAD NOT BEEN ABLE TO PRODUCE THE CERTAIN PARTIES FROM WHOM PURCHASES WERE MADE WHEN LETTERS SENT TO THE PARTIES WERE RETURNED UNDELIVERED OR THE PARTIES DID NOT RESPOND ? III ) WHETHER THE LD. CIT(A) SHOULD HAVE CONSIDERED THE FACT THAT THE ONUS WAS ON THE ASSESSEE TO GET THE PURCHASES VERIFIED WHEN REQUIRED TO DO SO ESPECIALLY WHEN SUCH PURCHASES WERE VERY SUBSTANTIAL IN AMOUNT, IN SOME YEARS ROUGHLY ABOUT 50 OF THE TOTAL PURCH ASES ? IV ) WHETHER THE LD CIT(A) ERRED IN ASSUMING THAT THE PURCHASES WERE ONLY INFLATED WHEN IT WAS CLEAR FROM THE CONDUCT OF THE ASSESSEE, THE PARTIES FOUND MISSING AND RESULTS OF THE INVESTIGATION OF ANOTHER GOVT. DEPARTMENT (SALES TAX), THAT THE PURCHASES COULD NOT BE PROVED AS GENUINE AND THEREFORE THE DISALLOWANCE BY THE AO WAS JUSTIFIED ? V ) WHETHER THE LD CIT(A) ERRED IN PRESUMING THAT SIMPLY BECAUSE NO ADDITION WAS MADE IN CASE OF SALES, IT WAS ACCEPTED AS GENUINE AND FURTHER ASSUMING THAT THEREBY PURCH ASES SHOULD BE GENUINE ? VI ) WHETHER THE LD. CIT(A) ERRED IN ACCEPTING THE AFFIDAVITS FROM SUPPLIERS WITHOUT ANY EXPLANATION FROM THE ASSESSEE WHY THE SUPPLIERS COULD NOT APPEAR BEFORE THE AO WHEN THEY WERE CALLED FOR EXAMINATION, SUBSEQUENTLY AND DETAILS SUC H AS COPIES OF ACCOUNTS, BANK TRANSACTIONS WERE NOT PRODUCED ? VII ) THE APPELLANT PRAYS THAT THE ORDER OF THE LD. CIT(A) - 1, NASHIK MAY PLEASE BE CANCELLED AND THE ORDER OF ASSESSING OFFICE MAY PLEASE BE RESTORED. VIII ) THE APPELLANT PRAYS TO ADDUCE SUCH FURTHER EVI DENCE TO SUBSTANTIATE HIS CASE. 6. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE AS AN INDIVIDUAL, HAD FURNISHED INCOME DECLARING TOTAL INCOME AT RS.5,04,260/ - . THE ASSESSING OFFICER RECEIVED INFORMATION FROM THE SALES TAX DEPARTMENT, MAHARASHTRA GIVIN G NAMES, ADDRESSES AND OTHER DETAILS OF PERSONS, WHO HAD PROVIDED ENTRIES OF BOGUS PURCHASES. THE SAID INFORMATION ALSO CONTAINED THE DETAILS OF BENEFICIARIES OF SUCH BOGUS BILLS. BEFORE THE SALES TAX AUTHORIT IES , THE PERSONS WHO HAD PROVIDED THE ENTRIES HAD ALSO FILED AFFIDAVITS STATING THAT THEY HAD MERELY PROVIDED ENTRIES TO THE BENEFICIARIES AND NO GOODS WERE SUPPLIED BY THEM TO THE SAID BENEFICIARIES. THE NAME OF ASSESSEE I.E. PROPRIETOR OF M/S. KARAN ENTERPRISES, NASHIK WAS IN THE LIST OF BENEFICIA RIES, WHO HAD OBTAINED BOGUS PURCHASE BILLS FROM THE ENTRY PROVIDERS. THE ITA NO S . 1365 TO 1367 /P U N/20 1 5 ITA NOS.1407 TO 1409/PUN/2015 SHRI NITIN RAMDEOJI LOHIA 5 DETAILS OF PURCHASE BILLS TOTALING RS.2,45,93,371/ - ARE PROVIDED AT PAGE 2 OF THE ASSESSMENT ORDER. SINCE, NO PROCEEDINGS WERE PENDING BEFORE THE ASSESSING OFFICER, INFORMATION WAS SOUGHT UNDER SECTION 133(6) OF THE ACT AND THE ASSESSEE WAS ASKED TO EXPLAIN THE GENUINENESS OF ABOVE PURCHASES. IN RESPONSE THERETO, THE ASSESSEE FURNISHED COPIES OF PURCHASE BILLS, STOCK REGISTERS AND LEDGER ACCOUNT OF THE PARTIES FOR VERIFICATION. TH E ASSESSING OFFICER AFTER RECORDING REASONS FOR REOPENING ASSESSMENT UNDER SECTION 147 OF THE ACT, ISSUED NOTICE UNDER SECTION 148 OF THE ACT. THE ASSESSEE IN REPLY, STATED THAT THE ORIGINAL RETURN OF INCOME FILED BY HIM SHOULD BE CONSIDERED AS IN COMPLIA NCE TO THE NOTICE ISSUED UNDER SECTION 148 OF THE ACT. THE REASONS RECORDED FOR REOPENING THE ASSESSMENT WERE PROVIDED TO THE ASSESSEE, WHO IN TURN, FILED OBJECTIONS WHICH WERE DISPOSED OF BY THE ASSESSING OFFICER. DURING THE YEAR UNDER CONSIDERATION, TH E ASSESSEE HAD SHOW N TOTAL SALES OF OIL AT RS. 4.39 CRORES, ON WHICH GROSS PROFIT WAS SHOWN AT RS.3,07,607/ - WHICH WORKED OUT TO 0.69%. THE ASSESSEE HAD SHOWN PURCHASES TO THE TUNE OF RS.4.36 CRORES. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, INFORMATIO N WAS CALLED FROM THE SAID PARTIES FROM WHOM THE ASSESSEE HAD CLAIMED TO HAVE MADE PURCHASES. HOWEVER, THE LETTERS WERE RETURNED BY THE POSTAL AUTHORITIES WITH THE REMARKS LEFT/REFUSED/NOT KNOWN. THE ASSESSEE WAS ASKED TO PRODUCE THE ABOVE PARTIES BUT T HE ASSESSEE COULD NOT PRODUCE ANY OF THE PARTIES. HENCE , THE ASSESSING OFFICER MADE AN ADDITION OF RS.2,45,93,371/ - . 7. THE CIT(A) AFTER REFERRING TO VARIOUS JUDICIAL PRECEDENTS ON THE ISSUE AND THE FACTS OF THE CASE NOTED THAT IN THE INSTANT CASE, THE A SSESSEE PURCHASED THE GOODS I.E. INDUSTRIAL OIL AGAINST CONFIRMED ORDERS RECEIVED. THE CIT(A) TOOK NOTE OF THE COUNTER AFFIDAVITS / NOTARIZED CERTIFICATES FROM THE SUPPLIERS CONFIRMING THE SALES MADE BY THEM AND ALSO STATING THAT ORIGINAL AFFIDAVITS WERE FORCIBLY OBTAINED BY THE ITA NO S . 1365 TO 1367 /P U N/20 1 5 ITA NOS.1407 TO 1409/PUN/2015 SHRI NITIN RAMDEOJI LOHIA 6 SALES TAX AUTHORITIES. THE CIT(A) NOTED THAT THE ASSESSING OFFICER HAD NOT DISPUTED THE SALES AND HENCE, IT WAS NOT CASE OF BOGUS PURCHASES AND AT BEST IT COULD BE A CASE OF INFLATION OF PURCHASES. THE CIT(A) WAS OF THE VIEW THAT GROSS PROFIT SHOWN BY THE ASSESSEE AT 0.69% WAS VERY LOW IN THE PARTICULAR KIND OF TRADE. CONSIDERING THE FACTS AND CIRCUMSTANCES, THE CIT(A) ESTIMATED THE GROSS PROFIT AT 5% ON THE HAWALA PURCHASES AND RE - COMPUTED THE INCOME. THUS, THE ASSESSING OFFICE R WAS DIRECTED TO MAKE 5% OF ADDITION IN THE GP RATIO AND DELETE THE BALANCE ADDITION. 8. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A) IN ADOPTING THE GP RATE ON THE ALLEGED HAWALA PURCHASES OF RS.2.45 CRORES @ 5% AS AGAINST 0.69% DECLARED BY T HE ASSESSEE RESULTING IN AN ADDITION OF RS.10,59,974/ - . 9. THE REVENUE IS IN APPEAL AGAINST THE ORDER OF CIT(A) IN DELETING THE ADDITION OF RS.2.45 CRORES ON ACCOUNT OF ALLEGED BOGUS PURCHASES FROM HAWALA PARTIES, WHERE THE ASSESSEE HAS FAILED TO PRODUCE THE PARTIES FROM WHOM THE PURCHASES WERE MADE AND ALSO WHERE LETTERS SENT TO THE PARTIES WERE RETURNED UNDELIVERED BY THE POSTAL AUTHORITIES. 10. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE VEHEMENTLY STRESSED THAT THE ASSESSEE HAD FILED AFFIDA VITS OF SUPPLIERS BOTH BEFORE THE ASSESSING OFFICER AND THE CIT(A) WHICH HAS NOT BEEN CONTROVERTED BY EITHER OF THE AUTHORITIES. HE FURTHER STRESSED THAT VERY BASIS FOR MAKING THE ADDITION IN THE HANDS OF ASSESSEE CEASED TO EXIST AND IN THE ABSENCE OF ANY OTHER EXERCISE OR EVIDENCE, THERE WAS NO MERIT IN MAKING ANY ADDITION IN THE HANDS OF ASSESSEE. HE ALSO REFERRED TO THE DECISION OF THE PUNE BENCH OF TRIBUNAL IN BUNCH OF CASES WITH LEAD ORDER IN M/S. CHHABI ELECTRICALS PVT. LTD. VS. DCIT AND OTHERS IN I TA ITA NO S . 1365 TO 1367 /P U N/20 1 5 ITA NOS.1407 TO 1409/PUN/2015 SHRI NITIN RAMDEOJI LOHIA 7 NO.795/PUN/2014 AND OTHERS , RELATING TO ASSESSMENT YEAR 2010 - 11, ORDER DATED 28.04.2017 AND POINTED OUT THAT WHEN THE PARTIES HAVE PRODUCED THE EVIDENCE, NO ADDITION HAS BEEN CONFIRMED. HE ALSO FAIRLY ADMITTED THAT IN CASE OF BOGUS PURCHASES, ADDITION WAS MADE @ 10% OF BOGUS PURCHASES OVER AND ABOVE THE GP RATE DECLARED BY ASSESSEE. 11. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ALSO PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW AND STRESSED THAT THE ADDITION OF TOTAL BOGUS PURCHASE S SHOULD BE MADE IN THE HANDS OF ASSESSEE IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 12. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ONLY ISSUE WHICH ARISES IN THE CROSS APPEALS FILED BY THE ASSESSEE AND THE REVENUE IS IN RELATION TO THE ALLEGED BOGUS PURCHASES MADE BY THE ASSESSEE. THE ASSESSEE WAS A TRADER IN INDUSTRIAL OIL. THE FINDINGS OF CIT(A) ARE THAT THE ASSESSEE WAS PURCHASING INDUSTRIAL OIL ONLY AGAINST THE CONFIRMED ORDERS IT PROCURES FROM DIFFERENT PARTIES. IN OTHER WOR DS, THE FACTUM OF MAKING THE PURCHASES IS NOT DOUBTED. THE BASIS OF THE ASSESSING OFFICER IN REJECTING PURCHASES IN THE HANDS OF ASSESSEE WAS THE INVESTIGATION CARRIED OUT BY THE SALES TAX AUTHORITY, UNDER WHICH IT HAD COMPILED THE LIST OF BOGUS SUPPLIERS , WHO IN TURN, HAD STATED TO HAVE ONLY ISSUED BILLS FOR SUPPLIES WITHOUT MAKING ACTUAL SUPPLIES OF THE GOODS TO VARIOUS BENEFICIARIES. THE LIST OF BENEFICIARIES WAS ALSO DRAWN BY THE SALES TAX DEPARTMENT. THE ASSESSING OFFICER HAS ALSO TAKEN NOTE OF THE FACT THAT BEFORE THE SALES TAX DEPARTMENT, THE SAID SUPPLIERS HAD ALSO BY WAY OF AFFIDAVITS CONFIRMED THAT THEY WERE ONLY ISSUING BILLS WITHOUT MAKING ANY SUPPLIES OF GOODS. IN THE CASE OF ASSESSEE, IN VIEW OF THE ABOVE SAID INFORMATION, REOPENING OF ASSE SSMENT WAS ITA NO S . 1365 TO 1367 /P U N/20 1 5 ITA NOS.1407 TO 1409/PUN/2015 SHRI NITIN RAMDEOJI LOHIA 8 MADE UNDER SECTION 147/148 OF THE ACT. THE ASSESSING OFFICER SHOW CAUSED THE ASSESSEE TO JUSTIFY THE PURCHASES MADE BY IT FROM THE ALLEGED HAWALA PARTIES. THE ASSESSEE WAS SHOW CAUSED IN THIS REGARD AND WAS ALSO ASKED TO PRODUCE THE PERSONS. THE ASSESSEE WAS UNABLE TO PRODUCE THE SAME. THE ASSESSEE CLAIMS THAT IT PRODUCED THE AFFIDAVITS FROM THREE DEALERS FROM WHOM IT HAD MADE THE PURCHASES, WHO IN TURN, CERTIFIED THAT THE SALES MADE BY THEM TO THE ASSESSEE WERE GENUINE AND THE PAYMENT AGAINS T DELIVERY OF GOODS WAS RECEIVED. THE CASE OF REVENUE ON THE OTHER HAND, IS THAT INVESTIGATION WAS CARRIED OUT BY THE SALES TAX DEPARTMENT THAT THE SAID PERSONS HAD GIVEN AFFIDAVITS THAT THEY WERE ISSUING BOGUS BILLS AGAINST NO DELIVERY OF THE GOODS. HOW EVER, AFFIDAVITS WERE FILED BY THE ASSESSEE OF THE SAID DEALERS BEFORE THE ASSESSING OFFICER AND ALSO BEFORE THE CIT(A) TO THE FACT THAT UNDER FORCE, THE SAID AFFIDAVITS WERE FILED BEFORE THE SALES TAX DEPARTMENT. FURTHER, THEY STRESSED THAT THE SALES MAD E BY THEM TO THE ASSESSEE, WHO WAS THE PROPRIETOR OF M/S. KARAN ENTERPRISES WERE GENUINE. THEY HAVE ALSO ENLISTED THE LIST OF SALES MADE BY THEM FOR THE RESPECTIVE YEARS ALONG WITH INVOICE NUMBERS AND THE TOTAL VALUE OF GOODS SOLD BILL - WISE. 13. THE CA SE OF REVENUE IS BASED ON THE INVESTIGATION CARRIED OUT BY THE SALES TAX DEPARTMENT AND THE INFORMATION FORWARDED TO THE ASSESSING OFFICER BY THE SAID SALES TAX DEPARTMENT. IN THE FIRST INSTANCE, NO CROSS - EXAMINATION OF THE SAID PERSONS WAS ALLOWED. HOWE VER, THE ASSESSEE HAS FILED AFFIDAVITS / CONFIRMATIONS IN RESPECT OF TRANSACTIONS UNDERTAKEN DURING THE YEAR. THE ALLEGATION OF NON - EXISTENCE OF TRANSACTION WAS MADE BY THE ASSESSING OFFICER AND HENCE, THE ONUS UPON THE DEPARTMENT WAS HEAVIER TO ESTABLISH ITS CASE. IN THE FACTS OF THE CASE, THE ASSESSEE HAD TRIED TO MEET THE CASE OF ASSESSING OFFICER AND HENCE, THE ONUS SHIFTED UPON THE ASSESSING OFFICER TO DISPROVE THE CLAIM OF ASSESSEE. THE ITA NO S . 1365 TO 1367 /P U N/20 1 5 ITA NOS.1407 TO 1409/PUN/2015 SHRI NITIN RAMDEOJI LOHIA 9 ASSESSING OFFICER HAS FAILED TO DISCHARGE THE ONUS IN THIS REG ARD . THUS, THE ASSESSING OFFICER HAS FAILED TO COMPLETE THE INVESTIGATION IN THE CASE. IN VIEW OF THE AFFIDAVITS / CONFIRMATION LETTERS FILED BY THE ASSESSEE, NO FURTHER ENQUIRIES WERE MADE IN THE PRESENT SET OF FACTS. IN THE ABSENCE OF THE SAME AND WHE RE THE ASSESSEE HAS TRIED TO BUILT UPON ITS CASE AND HAS ALSO SHOWN THE TRAIL OF GOODS I.E. AS AGAINST THE BOOKING OF SALES, IT HAD MADE THE PURCHASES AND IN THIS REGARD HAS COMPLETE QUANTITATIVE RECORDS AVAILABLE WITH HIM, THEN THE ONUS CAST UPON THE ASSE SSEE STANDS DISCHARGED ONCE THE SAME IS PRODUCED BEFORE THE AUTHORITIES BELOW. 14. IN THE TOTALITY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES, WHERE THE ASSESSEE HAS DISCHARGED THE ONUS OF PROVING THE FACTUM OF MAKING PURCHASES FROM THE RESPECTIVE PARTIES BY WAY OF FILING AFFIDAVITS AND ALSO ESTABLISHING THE TRAIL OF GOODS , IN TURN, RELYING ON THE STOCK DETAILS MAINTAINED BY HIM , THERE IS NO MERIT IN HOLDING THE SAID PURCHASES TO BE BOGUS. THE STATEMENTS OF BOGUS SUPPLIERS WERE RELIED UPON WITHOUT GIVING A N OPPORTUNITY TO CROSS - EXAMINE THE SAID PARTIES TO THE ASSESSEE. IT IS CASE OF TRADER, WHERE ADMITTEDLY, THE ASSESSEE WAS ENGAGED IN THE SALE OF INDUSTRIAL OIL AND ONLY AGAINST THE CONFIRMED ORDERS, IT WAS MAKING SAID PURCHASES ; THEN THE ASSESSEE HAS DISC HARGED THE ONUS CAST UPON HIM AND IN THE ABSENCE OF ANY CONTRARY EVIDENCE BEING BROUGHT ON RECORD, MERE RELIANCE ON THE INVESTIGATION CARRIED OUT BY THE SALES TAX DEPARTMENT DOES NOT WARRANT ANY ADDITION IN THE HANDS OF ASSESSEE. ACCORDINGLY, WE HOLD SO. THUS, WE DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION ON ACCOUNT OF BOGUS PURCHASES. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, ALLOWED AND THE GROUNDS OF APPEAL RAISED BY THE REVENUE ARE DISMISSED. ITA NO S . 1365 TO 1367 /P U N/20 1 5 ITA NOS.1407 TO 1409/PUN/2015 SHRI NITIN RAMDEOJI LOHIA 10 1 5 . THE FACTS AND ISSUE IN ITA NOS. 1366/PUN/2015 & 1367/PUN/2015 AND 1408/PUN/2015 & 1409/PUN/2015 ARE IDENTICAL TO THE FACTS AND ISSUE IN ITA NOS.1365/PUN/2015 & 1407/PUN/2015 AND OUR DECISION IN ITA NOS.1365/PUN/2015 & 1407/PUN/2015 SHALL APPLY MUTATIS AND MUTANDIS TO ITA NOS.1366/PUN/201 5 & 1367/PUN/2015 AND 1408/PUN/2015 & 1409/PUN/2015 1 6 . IN THE RESULT, ALL THE APPEAL S OF ASSESSEE ARE ALLOWED AND ALL THE APPEAL S OF REVENUE ARE DISMISSED. ORDER PRONOUNCED ON THIS 5 TH DAY OF JU LY , 201 7 . SD/ - SD/ - ( ANIL CHATURVEDI ) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 5 TH JU LY , 201 7 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) - I, NASHIK ; 4. / THE PR. CIT - I, NASHIK ; 5. , , / DR B , I TAT, PUNE; 6. / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE