Lexus Softmac Vs DCIT (ITAT Surat)
ITAT Surat held that as per section 150(2), re-assessment permission u/s 150(1) of the Act would not be available to the Department, since time limit for re-assessment as stated under section 149 has expired.
Facts- The assessee-firm is engaged in the business of manufacturing of diamond processing machinery. AO noticed that Shri Kamal J. Zaveri group had provided accommodation entries at Rs.24,60,439/- of bogus purchases i.e., Amar Enterprises at Rs.12,29,869/- and Mahadev Sales Corporation at Rs.12,30,570/- to the assessee. Thus, the AO had reason to believe that income of Rs.24,60,439/- had escaped assessment within the meaning of section 147 of the Act. Therefore, the case was reopened and notice u/s 148 of the Act was issued on 28.03.2019. After hearing the assessee, AO added Rs.24,72,741/- including commission of Rs.12,302/- u/s 69C of the Act to the total income of the assessee.
CIT(A) deleted the disallowance of Rs.24,60,439/- made by AO on account of bogus purchases. The CIT(A), however, directed the assessee to produce the copies of ledger account and other relevant details before AO to verify the claim of the assessee. The CIT(A) further held that since these bogus purchases of Rs.24,60,439/- from M/s Amar Enterprises and M/s Mahadev Sales Corporation were made in March, 2011 i.e., FY.2010-11, the AO was directed to tax these amount in AY.2011-12 as per the provisions of the Act.
