Assessee contests the legality of reassessment proceedings on account of alleged bogus purchases

This case involves an appeal by M/s Radha Gopi Impex against reassessment proceedings for the 2009-10 assessment year. The Income Tax Appellate Tribunal in Mumbai reviewed the legality of the reassessment, which was initiated due to alleged bogus purchases of Rs. 200.09 Lacs from M/s Aadi Impex, following searches on the Rajendra Jain Group. The Tribunal considered the validity of the notice issued for reassessment and the merits of the additions made.

IN THE INCOME TAX APPELLATE TRIBUNAL
“D” BENCH, MUMBAI

BEFORE HON’BLE SHRI MAHAVIR SINGH, VP AND
HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM
(Hearing Through Video Conferencing Mode)

I.T.A. No.5260/Mum/2019
Assessment Year: 2009-10)

M/s Radha Gopi Impex
11th Floor, Flat No.1102, Mamta Heights
414, Devdas Lane, Off. SVP Road
Boriwali West, Mumbai – 400 103
PAN No. : AAHFR-0445-D
Appellant)

Vs.

ACIT-Circle 32(3)
G Block, BKC, Bandra Kurla Complex
Bandra East
Mumbai - 400051
Respondent)

Assessee by : None
Revenue by : Shri Rajendra Joshi– Ld. Sr. DR

Date of Hearing : 25/05/2021
Date of Pronouncement : 01/06/2021

 O R D E R

Manoj Kumar Aggarwal (Accountant Member)

1. Aforesaid appeal by assessee for Assessment year [AY in short] 2009-10 contest the order of Ld. Commissioner of Income Tax (Appeals)-44, Mumbai [in short CIT(A) ] dated 10/06/2019 which has confirmed certain additions on account of alleged bogus purchases. In the grounds of appeal, the assessee contest the legality of reassessment proceedings as well as quantum additions on merit. 

2. Though none appeared for assessee, however, material on record was sufficient for disposal of the appeal. The Ld. DR pleaded for dismissal of the appeal.

3.1 The material facts are that the assessee being resident firm stated to be engaged in manufacturing & trading of diamonds was assessed for the year under consideration u/s 143(3) r.w.s. 147 on 05/12/2016. The original return filed by assessee was processed u/s 143(1). However, pursuant to search operations on Shri Rajendra Jain Group, it transpired that the assessee made alleged bogus purchases of Rs.200.09 Lacs from an entity namely M/s Aadi Impex allegedly run by that group. Accordingly, the case was reopened as per due process of law and a otice u/s 148 was sent through speed post on 23/03/2016. However, the notice was returned back by postal authorities with remarks ‘left’ and therefore, the assessee’s plea that the notice u/s 148 was not issued upto 31/03/2016 was rejected. During reassessment proceedings, the assessee was show-caused to substantiate the purchases made from M/s Aadi Impex.

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