ITO Vs Pratap Engineering Works (ITAT Jodhpur)
The Jodhpur ITAT dismissed the Revenue’s appeal and upheld the deletion of an addition made under section 69C on account of alleged bogus purchases based on information received from the GST Department. The Tribunal observed that although the reassessment was triggered by an investigation alleging that the supplier was a bogus entity issuing accommodation bills, the Assessing Officer had mechanically relied on the GST investigation report without conducting any independent enquiry, furnishing the complete report to the assessee, or granting an opportunity of cross-examination, thereby violating the principles of natural justice. The Tribunal further noted that the assessee had produced a complete trail of documentary evidence, including purchase orders, invoices, transport bilties and bank payment records, to establish the genuineness of the purchases. Since the assessee’s sales had been accepted and the books of account had not been rejected under section 145, the Assessing Officer failed to bring any cogent evidence to disprove the purchases. Holding that mere reliance on third-party GST findings was insufficient to sustain the addition, the Tribunal affirmed the well-reasoned order of the CIT(A) deleting the addition and dismissed the Revenue’s appeal.
FULL TEXT OF THE ORDER OF ITAT JODHPUR
