Case Law Details
Arun Kumar Aggarwal Vs ITO (ITAT Delhi)
ITAT Delhi held that initiation of proceedings under section 147/148 of the Income Tax Act unsustainable as there was on failure on the part of the assessee to disclose fully and truly all the material facts.
Facts- The case of the assessee was reopened by issuing notice u/s 148 of the Act on the basis of information received from DDIT, Investigation, New Delhi regarding frequent high- value cash deposits, transfer and RTGS credit followed by immediate transfer and RTGS debits leaving minimum balance in the account number 911020010105859 held in the name of M/s Astro Informatics. During the year under consideration, the assessee had received accommodation entries of Rs.48,49,500/- from M/s Astro Informatics by way of bogus purchases.
AO observed that the transactions in the account were mostly in round figures and the bank account brought out that there was trail of transfer of money from one account to another account. The assessee was one of the beneficiaries as also mentioned in the report of the Investigation Wing. AO held the said purchase of Rs.48,49,500/- to be accommodation entry by a dummy shell company. Accordingly, passed the assessment order by making addition of Rs.48,49,500/-by treating the same as accommodation entry.
Being aggrieved, the assessee preferred an appeal before the CIT(A), the CIT(A) restricted the addition of bogus purchase to Rs.34,02,000/- by partly allowing the Appeal filed by the assessee.
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