M/s VSR Enterprises, New Delhi ITO, New Delhi

This appeal concerns M/s VSR Enterprises for the assessment year 2007-08. The Assessing Officer reopened the case based on information suggesting the firm was involved in a syndicate smuggling Red Sanders Wood and trading banned items. The AO initiated proceedings under Section 147 of the Income Tax Act after receiving information about significant cash inflows and foreign remittances into the firm's bank account. The assessee was asked to explain various bank entries during the assessment proceedings.

IN THE INCOME TAX APPELLATE TRIBUNAL
 DELHI BENCH, ‘G’: NEW DELHI
(Through Video Conferencing)

BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND
SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER

ITA No.1855/Del/2016
 Assessment Year : 2007-08

M/s VSR Enterprises,
House No. G-146-A, Khasra
No.1/24, Shiv Ram Park,
Nilothi Nangloi,
New Delhi-110041,
PAN-AAFFV5459F
 (Appellant) 

Vs. 

ITO,
Ward-27(4),
New Delhi
(Respondent)

Appellant by : Sh. P.C. Yadav, Adv.
Respondent by : Sh. Prakash Dubey, Sr. DR

Date of hearing : 23.03.2021
Date of pronouncement : 18.05.2021

ORDER

PER R.K. PANDA, AM :

This appeal filed by the assessee is directed against the order dated 29.01.2016 of the learned CIT(A)-17, New Delhi, relating to Assessment Year 2007-08.

2. Facts of the case, in brief, are that the assessee is a partnership firm and engaged in the business of import and export of auto parts. It filed its original return of income on 30.10.2007 declaring total income of Rs.7,05,890/-. Subsequently, the Assessing Officer reopened the case u/s 147 of the Act by recording the following reasons:-

Information has been received from REIC through ITO Ward 43(4) New Delhi that M/s VST Enterprises Bank A/c No.43750 with Punjab & Sind Bank, Fatehpuri, Delhi, reveals an inflow of Rs.72 lakhs in cash and Rs.1.82 crores from Foreign Sources in 2007. According to the information, M/s VSR Enterprises is part of a Syndicate involved in smuggling of Red Sanders Wood run by one Shri Shekhar. The syndicate involved in trading of banned items across the borders such as exotic herbs, such as Ashwagandha, Peacock feather and a host of items wide name :pyaaz, “Aalu”, “Adrak” and “Seb”.

After considering carefully the contents and nature of the information available before me, I have reason to believe that income chargeable to tax has escaped assessment in the case of M/s VSR Enterprises for Asstt. Year 2007-08. Hence, proceeding u/s 147 of the I.T. Act, 1961 initiated.

Issue notice u/s 148 for the Asstt. Year 2007-08”

3. The Assessing Officer accordingly issued notice u/s 148 of the Act on 13.04.2011. In response to the same, the assessee vide letter dated 28.10.212 stated that the return filed originally on 30.10.2007 may be treated as return filed in response to notice u/s 148 of the Act.

4. During the course of assessment proceedings, the Assessing Officer asked the assessee to explain the various credit entries appearing in the bank account and also explain the reasons for cash withdrawal from the bank account. Various opportunities were granted by the Assessing Officer to the assessee to which the assessee filed a cash flow summary for the period of 01.04.2006 to 31.03.2007 which are reproduced at page 4 and 5 of the assessment order.

To know more in details find the attachment file