The Amritsar Bench of Income Tax Appellate Tribunal (ITAT) deleted the additions made for alleged bogus purchase bills and said that the Assessing Officer applied his mind to the information received from the Investigating Wing.
The appellant company, M/s Supertech Forgings (India) Pvt. Ltd. is engaged in the business of manufacturing of Aluminum conductor steel reinforced (ACSR Conductors), DPC Wire Strips (double paper covered wire), steel wire ropes, PVC Cables and besides trading of M.S Pipes, aluminum wire and allied products.
The Assessing Officer has formed his opinion for reopening the assessment on the basis of the report of the investigating wing of the revenue. During the recording of the statement of Shri Madan Lal Pahuja, the investigating wing observed that he was into the activity of providing bogus purchase invoices to various persons. While recording the reasons to reopen the assessment, the Assessing Officer has only mentioned the details of the statement recorded by the investigating wing. He had merely relied upon the report of the investigating wing. Further, the Assessing Officer has not provided a copy of the statement of Shri Madan Lal Pahuja recorded to the Assessee.
The Coram of Judicial Member, Lalit Kumar, and Accountant Member D.R. M.Meena ruled that it is essential for the Assessing Officer to provide the copy of the foundation fact, namely the statement of Shri Madan Lal Pahuja, to the Assessee at the time of providing reasons for reopening the assessment. He had merely mentioned the name of Brokers with whom he was carrying the transactions. However, there is no evidence to link the brokers, assessee, and Mr Phauja on record. Further, there is no evidence brought to record that the assessee had received bogus bills from the entities of Phauja.
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