Requre assessment order passed by ao in case of hawala purch

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

29 December 2014 Dear All,

My client taking Turnkey Contacts of Installing Fire Fighting Systems.
Case is reopened for Hawala Bills. Can any one provide me the assessment order where any AO has passed order favoring assessee having business of taking contract.
Can anyone help me in complex situation ?

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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29 December 2014 On what grounds the notice is sent to you and what exactly it has been printed in the said notice?

Querist : Anonymous

Querist : Anonymous (Querist)

29 December 2014 The case is reopened u/s 148, stating that the company has made purchases from Hawala Dealers.

Notice states as under:

It has come to the knowledge that the assessee company was involved in bogus purchases/ hawala transactions during the year. further as per information from sales tax authorities, the assessee company is stated to have accepted such bogus purchases/hawala transactions.

The assessee has booked bogus purchases from such dealers, thereby reduced its profit by inflating the expenses leading to the escapement of income chargeable to tax.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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29 December 2014 So now honestly say what exactly the assessee have done then only suitable advice can be given.

Amol S Joglekar

Amol S Joglekar (Expert)
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29 December 2014 The cases are very much aganist the ASSESSEEs under similar instances, where especiall assessee has acepted its bogus claim under VAT.

Querist : Anonymous

Querist : Anonymous (Querist)

29 December 2014 The party has purchased materials through Broker.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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29 December 2014 In reality how actual payments were made?

Querist : Anonymous

Querist : Anonymous (Querist)

29 December 2014 payments were made by cheque

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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29 December 2014 you need to provide all the details regarding how much cheque payments you have made and how they are genuine has to be proved.
Moreover when department have stated sales tax refrence then its confirm they have all the proof reagrding your hawala trading so matter is serious and you must consult a good ca in this case to defend as matter is too musch serios

Amol S Joglekar

Amol S Joglekar (Expert)
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29 December 2014 More than CHEQUE payment....NOW YOU NEED TO PROVE THAT THE GOODS HAVE COME TO YOUR PREMISES.

DrSANGITA PHD MBA(usa)CACSCWA

DrSANGITA PHD MBA(usa)CACSCWA (Expert)
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30 December 2014 This must be the Issue of Maharashtra VAT & notice u/s 148 issued Income Tax dept.As because of the Hawala Issue in MAHA VAT Dept in 2011 this is become a Big nusiance in Maharashtra, we also had similar issues in our Group Company Office in Mumbai & Pune
No need to Worry this Big, First File your Objections & Once Objections are Disposed & Rejected by the ITO start submitting the Details. The ITO must have acted Adament & stubborn with you saying he will add 100% & such are the Orders by his Chief Comm Etc.. bla bla bla & such foolish things he must have said, Dont bother on such things, If the case is properly Represented be sure Dept cannot make an addition of more than 10 - 15%. I am Bangalore based else I would have helped you in your case but You need any expert help you can Quoting my name & reference call on one of my Expert Friends Mr Chandrakant on 9819408963 at Mumbai who is handling such cases, he will give you a Proper solution.he has been doing this cases for our Mumbai / Pune Office.

DrSANGITA PHD MBA(usa)CACSCWA

DrSANGITA PHD MBA(usa)CACSCWA (Expert)
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30 December 2014 Mr Joglekar your Conception is very Wrong,
Acceptance by the Party ( Selling dealer ) with VAT Dept even in form of Affidavit or Deposition & Undertaking given to VAT Dept about issuing Bogus Invoices cannot effect the Purchasing dealer in Income tax. Such Declarations & Affidavits does not have any Substiantial evidentiary values in course of Income tax hearings. Refer the case of Jagdamba Trading Co v/s CIT at ITAT Jodhpur
Sir Contact my Friend at Mumbai on the above given Contact & he will Guide you

Sir also refer this crux of the
Guj HC Case

HIGH COURT OF GUJARAT
Commissioner of Income-tax-I
v.
Nangalia Fabrics (P.) Ltd.*
AKIL KURESHI AND MS. SONIA GOKANI, JJ.
TAX APPEAL NO. 689 OF 2010†
APRIL 22, 2013
I. Section 68 of the Income-tax Act, 1961 - Cash credit [Unverifiable purchases] - Assessing Officer found that purchases made by assessee could not be verified as parties were untraceable - Accordingly, he made addition to assessee's income - However, Tribunal held that since purchases were supported by bills, entries were made in books of account and payment was made by cheque, addition should have to be deleted - Whether issue being based on facts, required no consideration - Held, yes [Para 4] [In favour of assessee]
II. Section 37(1) of the Income-tax Act, 1961 - Business expenditure - Allowability of [Commission] - Whether where brokerage commission was paid through account payee cheques for sales canvassed by a party and also in consideration of collection recovered from purchaser, said commission payment could not be held to be bogus - Held, yes [Para 6] [In favour of assessee]

There are Many such cases. where Addition was deleted or considered at 5 - 10%. Max. Its only how you handle the case & how legally you represent, else ITO will abruptly add 100% & levy 100% penalty & put you in a Big Mess

Amol S Joglekar

Amol S Joglekar (Expert)
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01 January 2015 Dr Sangita : Thank you for your referred case law on sec 68.

According to me, the present case is to prove that PURCHASES were NOT SHAM/BOGUS

The querist has written that 148 states: The assessee has booked bogus purchases from such dealers, thereby reduced its profit by inflating expenses leading to escapement of income chargable to tax

Assessee must be able to PROVE that the same were NOT sham/bogus. The question of CONSTRUCTIVE delivery will play a major role in this.

From the view point of "GOOD Governance", I respectfully submit that I disagree with your views.

DrSANGITA PHD MBA(usa)CACSCWA

DrSANGITA PHD MBA(usa)CACSCWA (Expert)
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24 February 2015 Proving that this was a sham is the Onus of the Department, when the assessee shows all Bills & Payments by A/c Payee cheques. We have got cases of Our 7 Group Companies settled in Mumbai / Pune with 8 - 12.5% additions & now have gone in Appeal where we will get the additions scrapped down to anywhere between 0 - 5% Maximum. This are issues requiring strong & Proper Presentation & Representation with expert Knowledge on Taxation Practice of Abnormal issues like this