[Cites 24, Cited by 0]
Gujarat High Court
The Principal Commissioner Of Income ... vs M/S Suraj Limited on 27 January, 2026
Author: A. S. Supehia
Bench: A.S. Supehia
NEUTRAL CITATION
C/TAXAP/122/2025 ORDER DATED: 27/01/2026
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/TAX APPEAL NO. 122 of 2025
With
R/TAX APPEAL NO. 123 of 2025
With
R/TAX APPEAL NO. 124 of 2025
With
R/TAX APPEAL NO. 188 of 2025
With
R/TAX APPEAL NO. 187 of 2025
With
R/TAX APPEAL NO. 191 of 2025
=============================================
THE PRINCIPAL COMMISSIONER OF INCOME TAX 1, AHMEDABAD
Versus
DEE ARE TEXFAB PVT LTD.
=============================================
Appearance:
MR.VARUN K.PATEL(3802) for the Appellant(s) No. 1
MR. JIGNESH P PARIKH(14274) for the Opponent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE A.S. SUPEHIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
Date : 27/01/2026
COMMON ORAL ORDER
(PER : HONOURABLE MR. JUSTICE A.S. SUPEHIA)
1. Leave to replace Annexure-B i.e. the order dated
05.09.2019 passed by the Commissioner of Income-Tax
(Appeals)-11, Ahmedabad, is granted in Tax Appeal Nos. 122 of
2025 and 123 of 2025.
2. All these appeals are filed against identical orders dated
14.05.2024 passed by the Income Tax Appellate Tribunal, "A"
Bench, Ahmedabad (hereinafter referred to as "the Tribunal")
in the appeals filed by the Revenue Department. Since the
impugned orders of the Tribunal are common order passed in
the different Revenue's appeals as well as the Assessee's
appeal, Tax Appeal No.122 of 2025 is taken up as the lead
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matter and the facts of the said appeal are considered for
deciding all these appeals. The details of the appeals are as
under : -
Appeal No. ITAT Appeal No. ITAT Appeal by AY
122 /2025 IT(SS)A 515/2019 Assessee
2012-2013
123 /2025 IT(SS)A 536/2019 ACIT CC 1(3)
124 /2025 IT(SS)A 447/2019 ACIT CC 1(3) 2011-2012
188 /2025 IT(SS)A 446/2019 ACIT CC 1(3) 2008-2009
187 /2025 IT(SS)A 543/2019 ACIT CC 1(3)
2013-2014
191 /2025 IT(SS)A 516/2019 Assessee
3. The following proposed substantial questions of law arise
for consideration in Tax Appeal No.122 of 2025.
"(a) Whether on the facts and in the circumstances of the
case and in law, the learned ITAT has erred in deleting
addition of Rs.28,35,53,132/- on account of disallowance
of bogus purchase?
(b) Whether on the facts and in the circumstances of the
case and in law, the learned ITAT has erred in not
considering the facts that in the statement given before
the Central Excise Authority, Shri Kartik Ramesh Shah,
Director of M/s Shah Foils Ltd. categorically accepted that
the sales were effected through M/s Sankalp Foils Pvt.
Ltd. and after the clearance of goods from the factory of
M/s Shah Foils Ltd., M/s Sankalp Foils Pvt. Ltd. diverted
the goods and sold the same to some other parties and
gave only invoices to the assessee, without delivery of
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the Goods, and the said statement has also been
countersigned by Shri Snehal Rajnikant Shah, Director of
M/s Sankalp Foils Pvt. Ltd.?
(c) Whether on the facts and in the circumstances of the
case and in law, the learned ITAT has erred in not
considering the categorical confirmation of Shri Ashok T.
Shah that the company Suraj Limited received only
CENVATABLE invoices from M/s. Shah foils Ltd. and M/s.
Sunrise stainless Ltd. without receipt of goods and the
statement of other persons as discussed in the
assessment order have not been taken in toto.?
(d) Whether on the facts and in the circumstances of the
case and in law, the learned ITAT has erred in relying
upon the decision in the case of Shah Foils Ltd and
Sunrise Stainless P Ltd only and has not appreciated that
GST department has filed further appeal before this
Hon'ble Court in the case of Sunrise Tradewings Put. Ltd.
on the grounds, that digital data found in pen drive and
other circumstantial evidences have not been
appreciated by CESTAT?"
4. In all these appeals, these are the identical substantial
questions of law, which are proposed, however in the appeal
being Tax Appeal No.123 of 2025, an additional substantial
question of law is proposed and the same reads as under : -
"(e) Whether on the facts and in the circumstances of the
case and in law, the learned ITAT has erred in deleting
addition of Rs.4,83,000/- on account of interest
payment?"
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5. At the outset, learned advocate Mr.Jignesh Parikh,
appearing for the respondent-Assessee, has submitted that
the present appeals are liable to be dismissed in view of the
order dated 08.01.2020 passed by the Coordinate Bench of
this Court in Tax Appeal No.659 of 2019 and allied matters.
Against the said order, the Revenue had preferred Special
Leave Petition (C) Nos.13826-13828 of 2020, which came to be
dismissed by the Supreme Court vide order dated 08.01.2021.
However, learned Senior Standing Counsel Mr.Varun Patel has
submitted that the decision of this Court dated 08.01.2020
passed in Tax Appeal No.659 of 2019 and allied matters would
not be applicable to the facts of the present case, as the said
decision was rendered in tax appeals preferred by the GST
Department and the issue involved therein pertained to bogus
supplies of goods and receipt of goods without issuance of any
invoice. In contrast, in the present case, the Assessing Officer,
after a threadbare analysis of the monetary transactions of the
respondent-Assessee with three entities, namely (i) Shah Foils
Ltd., (ii) Sunrise Stainless Pvt. Ltd., and (iii) Sunrise Tradewings
Pvt. Ltd., and has made additions for the Assessment Years
2008-2009, 2011-2012, 2012-2013 and 2013-2014.
6. It is further submitted by the learned Senior Standing
Counsel that the issue before the Assessing Officer acting
under the Income-tax Act, 1961 was entirely different from the
issue which fell for consideration before the concerned officer
of the GST Department. It is further submitted that the learned
Tribunal has failed to appreciate the facts recorded in the
assessment order and the fact that the Director of M/s. Shah
Foils Limited had categorically admitted, in his statement
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recorded before the Central Excise Authorities / Director
General of Central Excise Intelligence (DGCEI) that there was
no actual delivery of goods. The Commissioner of Income-tax
(Appeals), at page 50 of the Appellate Order, had also
accepted the fact that the purchases from the three parties
were to be treated as bogus. It is further submitted that the
observation made by the Tribunal that these were merely
allegations without any significant evidence and that they did
not pertain to the year under consideration is erroneous, as the
evidence found during the search and survey action conducted
in the case of the Suraj Group clearly suggested that the sales
and purchase transactions were also carried out in cash by the
assessee. It is further submitted that the Tribunal decided the
issue by relying only upon the decisions in the cases of Shah
Foils Ltd. and Sunrise Stainless Pvt. Ltd., without appreciating
the fact that the GST Department has filed a further appeal
before this Court in the case of Sunrise Tradewings Pvt. Ltd. on
the ground that the digital data found in a pen drive and other
circumstantial evidence had not been properly appreciated by
the Customs, Excise and Service Tax Appellate Tribunal
(CESTAT). From the aforesaid facts, it is also evident that the
decision in the case of Sunrise Stainless Pvt. Ltd. is still
pending adjudication and, therefore, it is premature to
conclude that the assessee has been absolved of all charges
relating to bogus billing and wrongful availment of input tax
credit / Central Value Added Tax (CENVAT) credit. It is urged
that in view of the above, the impugned order passed by the
learned Tribunal is erroneous, illegal, and untenable.
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7. It is submitted by the learned Senior Standing Counsel
that the learned Tribunal has erred in not considering the fact
that, in the statement given before the Central Excise
Authorities, Shri Kartik Ramesh Shah, Director of M/s. Shah
Foils Ltd., categorically admitted that the sales were effected
through M/s. Sankalp Foils Pvt. Ltd., and that after clearance of
the goods from the factory of M/s. Shah Foils Ltd., M/s. Sankalp
Foils Pvt. Ltd. diverted the goods and sold the same to other
parties, while issuing only invoices to the assessee without
actual delivery of goods. The said statement was also
countersigned by Shri Snehal Rajnikant Shah, Director of M/s.
Sankalp Foils Pvt. Ltd.
8. In response to the aforesaid submissions, learned
advocate Mr.Parikh has referred to the findings recorded by
the Assessing Officer and has submitted that the Assessing
Officer, after examining the very same material, which had
been examined by the DGCEI in relation to the three entities
and the connected transactions between the present appellant
and the respondent-assessee, held that bogus invoices were
generated with the help of bogus parties, cash was collected
therefrom, and the opening stock was inflated without any
actual stock having entered the factory premises. It is further
submitted that this Court, after analysing the entire search
proceedings and the data retrieved from the seized pen drive
during the search, had considered the very same material
through a Coordinate Bench and, ultimately, dismissed the tax
appeals filed by the GST Department in Shah Foils Ltd.,
thereby confirming the order passed by the Customs, Excise
and Service Tax Appellate Tribunal (CESTAT) in relation to the
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said three entities namely (i) Shah Foils Ltd., (ii) Sunrise
Stainless Pvt. Ltd., and (iii) Sunrise Tradewings Pvt. Ltd. It is
submitted that the conclusion drawn by the Assessing Officer
on the basis of the same material emanating from the pen
drive is contrary to the decision of this Court, and accordingly,
it is urged that the present tax appeals may not be
entertained.
9. We have heard the learned advocates appearing for the
respective parties at length.
10. The facts, which emerge from the impugned orders as
well as the assessment orders in the case of the present
appellant, are that a search and seizure operation was
conducted at M/s.Suraj Limited, wherein the involvement of
Shah Foils Ltd., Sunrise Tradewings Pvt. Ltd., and Sunrise
Stainless Pvt. Ltd. was detected. A search proceeding under
Section 132 of the Income-tax Act, 1961 (in short, "the Act")
was carried out in the case of M/s.Suraj Limited and its group
concerns on 18.12.2013, during which the involvement of the
aforesaid entities was found.
11. During the course of the search and seizure action
conducted on 18.12.2013 at the factory premises of the
assessee, the Assessing Officer came to know that the DGCEI
had earlier conducted a search on the assessee on 06.12.2013
and had also carried out investigations against the
aforementioned entities, which were listed as suppliers of
goods to the assessee. During the post-search inquiry, the
DGCEI, Mumbai, furnished details to the Assessing Officer vide
communication dated 18.03.2014. It is further recorded in the
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assessment order that certain ledgers were found in pen drives
which were seized by the DGCEI from the lockers of the
Director of M/s.Shah Foils Ltd. The said ledgers revealed
transactions pertaining to the present respondent- assessee.
Upon investigation and analysis of the data so provided by the
DGCEI, the Assessing Officer ultimately recorded as under:-
"7. The onus is upon the assessee to establish the entries passed
in the books of account by first proving that the transaction entered
into is genuine, Incurred for the purpose of business and also by
establishing its case by way of corroborative evidence. In cases,
where the assessee claims that it has made purchases from various
parties, just because the purchases are evidenced by purchase bills
are not sufficient evidence to establish the genuineness of the
transaction, especially in a case, where there is evidence exists that
the transaction entered into by the assessee is bogus. It is
established fact that the parties from whom the assessee had made
the purchases were proven of giving bogus sale invoices without
actual delivery of the goods by DGCEI t on the fact that they had
entered into accommodation entries of providing the bills without
transfer of goods, on which though CENVAT was collected but was
not deposited with the Excise Department.
8. Even for a while, for a sake of discussion, it is has accepted that
the corresponding purchases were entered into books of account of
the assessee, but the presumption would be that the purchases were
made from alternate sources The purchases made from alternate
sources corresponding to the bogus purchases should be treated as
unexplained expenditure under section 69C of the Act.
9. xxxx..... All the above discussions is to refute the claim of the
assessee as it is a clear case where hogus invoices were generated
with the help of bogus parties, cash was collected from them and the
opening stock was inflated without any actual stock entering into
the factory premises. Hence, though the assessee company have
submitted all documents related with purchases, it again stands
bogus and once again, it is proved that purchases are bogus.
In view of these, purchases of Rs. 17,03,70,650/- (as per b/a) from
M/s Shah Foils Pvt Ltd., Rs.10,28,00,827/- from M/s Sunrise
Stainless Pvt. Ltd. and Rs.1,03,81,655/-totalling to Rs.
28,35,53,132/- made during year is treated as bogus purchases and
added to the total income of the assessee."
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12. Accordingly, penalty proceedings were initiated for
furnishing inaccurate particulars of income leading to
concealment of income under Section 271(1)(c) of the Act. The
said proceedings culminated in appeals before the
Commissioner of Income-tax (Appeals), Ahmedabad, the
details of which are as under:-
HC ITAT
ITAT
Appeal Appeal AY CIT Appeal ITAT
Appeal No
No. by
122 IT(SS)A Addition to ITAT allowed the
Assessee
/2025 515/2019 the tune of appeal on the
2012- 12.5 % of ground that the
123 IT(SS)A ACIT CC 2013 Bogus vendors have been
/2025 536/2019 1(3) Purchase absolved from all
was made changes by
124 IT(SS)A ACIT CC 2011- Appeal CESTAT and in
/2025 447/2019 1(3) 2012 allowed on case of Shah Foils
Ground of by Gujarat High
188 IT(SS)A ACIT CC 2008- no Court as well. SLP
/2025 446/2019 1(3) 2009 incriminatin filed against the
g material same is dismissed.
187 IT(SS)A ACIT CC Addition to Further the
/2025 543/2019 1(3) the tune of CENVAT Credit
2013- 12.5 % of reversed by the
191 IT(SS)A 2014 Bogus assessee was
Assessee
/2025 516/2019 Purchase refunded by Excise
was made Department .And
for AY 14-15 other
Respondent in all appeals are -Suraj Limited before additions were
the ITAT deleted
13. The Revenue, being aggrieved by the order passed in
appeal, preferred appeals before the Tribunal. However, the
Tribunal dismissed the appeals filed by the Revenue, which has
resulted in the present tax appeals.
14. The assessee, on the other hand, had filed appeals before
the Tribunal challenging the addition of 12.5% towards alleged
bogus purchases, whereas the Revenue had challenged the
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relief granted by the Commissioner of Income-tax (Appeals).
The Tribunal, by a common order, decided the appeals, which
has ultimately culminated in the filing of the present tax
appeals proposing the aforesaid substantial questions of law.
15. The aforesaid facts relating to the search conducted
against the entities, including the present assessee, are not in
dispute. What is in dispute is whether the incriminating
material sought to be relied upon by the Assessing Officer,
which emanated from the pen drives, could form the basis for
the additions made and the Assessing Officer proceeded on
assumptions with respect to the entries contained therein and
by placing reliance on the evidence and material supplied by
the DGCEI, concluded that the assessee had made purchases
which were alleged to be bogus, without corresponding sale
invoices and without actual delivery of goods. Similar findings
were recorded by the DGCEI.
16. It is pertinent to note that the Assessing Officer, on
presumptions, held that the purchases were made from
alternate sources corresponding to the alleged bogus
purchases and, therefore, treated the same as unexplained
expenditure under Section 69 of the Act.
17. Ultimately, the Tribunal, after considering the entire
material on record, held as under:-
"12. It is an undisputed fact recorded in the orders passed by the
Revenue Authorities also that the addition of bogus purchases made
in the hands of the assessee arose on account of search action
carried out by the DGCEI on the seller i.e. Sun Stainless Pvt.Ltd.,
Shah Foils Ltd. and Sunrise Tradewings P.Ltd. on 10.7.2012, and
search action conducted by the DGCEI on the assessee on
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6.12.2013. The assessee has filed the order passed by the Hon'ble
Gujarat High Court in the case of Shah Foils Ltd. in pursuance to the
search action conducted by the DGCEI on it, which order was
passed in R/Tax Appeal No.659 of 2019 with R/Tax Appeal Nos.660-
661 of 2019 decided on 8.1.2020, recording the fact of search
conducted by the DGCEI on Shah Foils Ltd. on 10.7.2012 at para 6.1
of the order, and finding of the investigation by the DGCEI that they
had suppressed production of goods and removed goods for sale
without payment of excise duty, which recorded at para 6.1 to 6.5 of
the order. The order further reveals that CESTAT allowed the
assessee's appeal vide its order dated 18.1.2019 vide final order in
Appeal Nos.A/10120-10125/2019 holding that charges of clandestine
removal of goods was not sustainable. The Department went in
appeal against the order of the CESTAT to the Hon'ble Gujarat High
Court, who in turn rejected the appeal filed by the Department
finding no question of law arising for consideration. Their finding at
para 9 of the order reads as under:
"9. In view of the aforesaid finding of facts arrived at by the
Tribunal, after considering the material placed before it, no
question of law much less any substantial question of law
arises for consideration out of the impugned order and
accordingly, the appeals are summarily rejected. No order as
to cost."
13. Before us, the assessee has also placed order of the Hon'ble
Supreme Court dismissing the SPL filed by the Revenue against the
above order of the Hon'ble Gujarat High Court, in Special Leave to
Appeal (c) Nos.13826- 13828 of 2020 vide order dated 8.1.2021. It is
thus patently clear from the above that Shah Foils Ltd. was absolved
of all the charges of clandestine/ unaccounted sales leveled on it on
account of investigation of the DGCEI by virtue of search conducted
on 10.7.2012.
14. Before us, was also placed order of the CESTAT, Western Zonal
Bench, Ahmedabad in the case of Sunrise Stainless P.Ltd. and
Sunrise Tradewings P.Ltd. recording the fact of appeal arising on
account of orders passed in both their cases in pursuance to search
conducted by the DGCEI on 10.7.2012 revealing clandestine sales
made by them without payment of excise duty. The CESTAT held
that charges of clandestine removal of goods was not sustainable as
recorded in para 16 of its order on both the parties. The said order
was passed in Appeal No.10939 and 10940 2015. It is abundantly
evident from the above that both M/s Sunrise Stainless P.Ltd., and
M/s Sunrise Tradewings were absolved of all the charges of
clandestine/ unaccounted sales leveled on it on account of
investigation of the DGCEI by virtue of search conducted on
10.7.2012.
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15. Further, the assessee filed before us, order passed by the
CESTAT, Ahmedabad in its own case in final order No.A/12183-
12189 of 2022 dated 12.12.2022 taking cognizance of all the above
orders passed in the case of Shah Foils Ltd., Sunrise Stainless P.Ltd.
and consolidated assessee's appeal against the order passed by the
Excise Department raising demand on the assessee on account of
availing CENVAT credit on the strength of purchase invoice,
received from aforementioned parties without receipt of inputs in
their factories, i.e. based on bogus purchase made by the assessee.
The assessee also filed before us copy of the order of the
Commissioner (Appeals) Central GST, Appeal Commissionerate,
Ahmedabad dated 18.8.2023 recording the fact of CENVAT credit of
Rs.75 lakhs availed by the assessee being reversed on search
conducted by the DGCEI on the assessee on 6.12.2023 at para 2.1 of
its order. The assessee had sought refund of the same in its appeal
which was granted vide impugned order at para -6 holding that the
assessee was entitled to refund of Rs.75 lakhs along with interest.
Thus, it is clear that once the assessee was absolved of the charges
levelled on it of having availed wrong input credit/CENVAT credit,
entire CENVAT credit reversed was refunded to it. It is evident from
the above facts narrated and stated by the ld.counsel for the
assessee before us , that the basis for holding purchases made by
the assessee, to be bogus, no longer survive, which is abundantly
clear from the orders of various judicial authorities, as gone through
by us as above.
16. In view of the same, there is no case, we hold, for making any
addition of bogus purchases in the hands of the assessee, and all the
additions so made are therefore directed to be deleted. All the
appeals of the assessee as a consequence are allowed in above
terms, and that by the Revenue are dismissed.
17. In the result, all the appeals of the assessee are allowed, while
the appeal of the Revenue are dismissed as per above terms."
18. At this stage, we may refer to the observations made by
the Coordinate Bench of this Court in its order dated
08.01.2020 passed in Tax Appeal No. 659 of 2019 and allied
matters. The Coordinate Bench, while examining the issue of
availment of credit on the basis of bogus invoices without
actual receipt of goods, held as under:-
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"6.8 Being aggrieved with the above OIO, the assessee and it's
Directors, Shri Ramesh M Shah and Shri Kartik R Shah filed an
appeal before the CESTAT, West Zone, Ahmedabad vide Appeals
No.E/12274/2018; E/11436/2018 and E/11433/2018 respectively.
The Hon'ble CESTAT vide Final Order No.A/10120 10125/2019,
dated 18.01.2019 allowed all the appeals and set aside the
impugned order dated 27.02.2018 mainly observing that:
(i) the charges of clandestine removal on the basis of pen drive data
are not sustainable;
(ii) since already held that the pen drive data is not substantial
evidence and no evidence of extra receipt has been produced in the
form of person from whom such extra consideration was given, how
it was given and how it was received by assessee, therefore, the
demand on account of undervaluation is not sustainable.
(iii) revenue has not proved the allegation with any evidence as it
has to be shown by making investigation at the supplier's end,
statements of suppliers and other corroborative evidences including
receipt from suppliers, thus, the allegation on the ground of
availment of CENVAT on the basis of invoice without receipt of
goods are not sustainable.
7. With regard to sole evidence which has been relied upon by the
Department is only pen driver data and statement of brokers which
were even self contradictory, the Tribunal has held that:
"Though the statement of directors has also been relied upon
by the department, but we found that even in some
statements they have stated that the data found in pen drive
do not belong to M/s SFL and it belongs to M/s Sankalp.
Inspite of fact that some of the statements were recorded in
presence of Snehil R shah who is director of M/s Sankalp, but
even then he was not questioned about such data. At least the
officers could have recorded his statement to ascertain the
truth. Even if the statements of director are considered
inculpatory the same cannot be relied upon in absence of
corroboration with material evidence as held in case of Tejwal
Dyestuff Ind. Vs. 2007 (216) ELT 310 (TRI) and 2009 (234)
ELT 242 (GUJ.). Thus the statement of directors cannot lead
to inference that the goods stated in "Bombay Sales" ledgers
are of Appellant. We also find that the brokers have even
stated that they have taken the goods from Vasai Godown of
M/s SFPL. In such case there is no reason to hold that the
Appellant has dealt with M/s SFL. Thus in both cases i.e
"Bombay Sales" and "Smi Cash Sales" apart from the
statements which are even contradictory no corroborative
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evidence. The Appellant has placed reliance upon various
judgments to canvas their point that in absence of
corroborative evidence no demand can be made. We find that
no corroborative evidence has been stated in show cause
notice in the form of receipt of unaccounted raw material,
transportation of unaccounted such raw material to SFL
factory, consumption of unaccounted raw material,
production of unaccounted finished goods, production record
of unaccounted finished goods, use of consumables, extra
labour and excess consumption of electricity, clearance of
goods from the factory, receipt of cash from even a single
person on account of alleged clandestine sale. We also find
that the revenue did not undertake any investigation at the
end of M/s SFPL from where the clearance of goods has taken
place. When the brokers had stated that the delivery was
taken from Vasai Godown which was under the ownership of
M/s SFPL, the officers should have made investigation. Thus
in such circumstances, the demand on account of clandestine
removal cannot be made. In case of Davinder Sandhu Impex
Ltd. 2016 (337) E.L.T. 99 (Tri. Del.), the tribunal has held
that -
"6. In this case during the course of investigation, the
statement was recorded and the statement given by
Shri Baldev Singh, Managing Director admits that
there is a shortage of 10 to 15% for manufacturing the
final product and it is also admitted by Shri Baldev
Singh that they have cleared certain goods without
payment of duty, but the said statement was retracted
by Shri Baldev Singh who claims to be that same has
been recorded under influence and duress, thereafter,
another statement was recorded on 3 rd May, 2005
which was also retracted on the same day, where also
same statement recorded which is a typed one and it is
the claim of the Revenue that same has been typed by
Shri Dinesh Kumar (who is an employee of the
appellant) in the office of the Department. To that
effect, Shri Dinesh Kumar filed an affidavit on 1st
August, 2006 that the statement has been typed by the
officers of the Department themselves not by him and
that said affidavit has not been controverted. Further,
the crossexamination of Shri Ashwani Kapoor,
Inspector on 3rd August, 2006 explaining that wastage
on each stage of production have not been considered
by the Adjudicating Authority. Moreover, the Knitwear
Club, Ludhiana which is an independent body have also
stated in their letter dated 19 May, 2005 that in normal
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course, there is a wastage of around 40% same has also
not been considered by the Adjudicating Authority but
without bringing any corroborative evidence apart from
statement of Shri Baldev Singh demand has been
confirmed."
8. With regard to onus to prove clandestine clearances by sufficient
cogent, umimpleachable evidence, the Tribunal has held that:
"20. We also find that the onus to prove clandestine
clearances has to be discharged by sufficient cogent,
unimpeachable evidence as held in case of CCE VS Laxmi
Engg. Works 2010 (254) ELT 205 ) P & H), Shingar Lamps
Pvt. Ltd., Vs CCE 2002 (150) ELT 290 (T), CCE Vs Shingar
Lamps Pvt. Ltd. 2010 (255) ELT 221 (P & H), Ruby Chlorates
(P) Ltd., Vs CCE 2006 (204) ELT 607 (T), CCE Vs Gopi
Synthetics Pvt. Ltd. 2014 (302) ELT 435 (T), CCE Vs Gopi
Synthetics Pvt. Ltd., 2014 (310) ELT 299 (Guj), Aum
Aluminium Pvt. Ltd. Vs CCE 2014 (311) ELT 354 (T), Sharma
Chemicals Vs CCE 2001 (130) ELT 271 (T), Resha Wires Pvt.
Ltd., Vs CCE 2006 (202) ELT 332 (T), Atlas Conductors Vs
CCE 2008 (221) ELT 231 (T), Vishwa Traders Pvt Ltd., Vs
CCE 2012 (278) ELT 362 (T), CCE Vs Vishwa Traders Pvt.
Ltd. 2013 (287) ELT 243 (Guj), CCE Swati Polyester 2015
(321) ELT 423 (Guj), Commissioner Vs Swati Polyester 2015
(321) ELT A217 (SC), Flevel International Vs CCE 2016 (332)
ELT 416 (Guj), CCE Vs Renny Steel Casting (P) Ltd.
2012(283) ELT 563 (T), CCE Vs Akshay Roll Mills Pvt. Ltd.
2016 (342) ELT 277 (T), Industrial Filter & Fabrics Pvt. Ltd.
Vs CCE 2014 (307) ELT 131 (T), CCE Vs Birla NGK Insulators
Pvt. Ltd. 2016 (337) ELT 119 (T), CCE Vs Ganesh Agro Steel
Industries 2012 (275) ELT 470 (T), UOI Vs MSS Foods
Products Ltd. 2011 (264) ELT 165 (P & H), CCE Vs Sree
Rajeswari Mills Ltd. 2009 (246) ELT 750 (T), CCE Vs Sree
Rajeswari Mills Ltd. 2011 (272) ELT 49 (Mad.), Shardha
Forge Pvt. Ltd., Vs CCE 2005 (179) ELT 336 (T), Arya Fibres
Pvt. Ltd. Vs CCE 2014 (311) ELT 529 (T), TGL Poshak
Corporation Vs CCE 2002 (140) ELT 187 (T). In view of said
judgments we find that the charges of clandestine removal on
the basis of pen drive data and sheets are not sustainable."
9. In view of the aforesaid findings of facts arrived at by the
Tribunal, after considering the material placed before it, no question
of law much less any substantial question of law arises for
consideration out of the impugned order and accordingly, the
appeals are summarily rejected. No order as to costs."
NEUTRAL CITATION
C/TAXAP/122/2025 ORDER DATED: 27/01/2026
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19. Ultimately, in view of the order passed by the Coordinate
Bench, the amount of Rs.75,00,000/- availed by the assessees
was reversed, and the Appellate Authority also granted refund
of Rs.75,00,000/- along with interest.
20. In the wake of the aforesaid judgment and order, the
Special Leave Petition filed by the Revenue also came to be
dismissed. Since the issue relating to bogus purchases has
already been settled by this Court, and the SLP filed
thereagainst has been dismissed, the Assessing Officer fell in
error in resurrecting the very same issue on the basis of the
material supplied by the DGCEI. The said material pertained to
transactions with bogus parties, in respect of which the
amount had already been refunded to the assessee, and the
issue regarding bogus purchases involving the three entities
referred to hereinabove had attained finality in favour of the
assessee.
21. In view of the above, we do not find that any question of
law, much less any substantial question of law, arises for
consideration in the present appeals.
22. So far as the additional proposed substantial question of
law relating to interest of Rs.4,00,000/- is concerned, having
regard to the smallness of the amount, we are not inclined to
remand the matter to the Tribunal, particularly in view of the
observations made by the Commissioner of Income-tax
(Appeals).
23. With these observations, the present appeals are
allowed.
NEUTRAL CITATION
C/TAXAP/122/2025 ORDER DATED: 27/01/2026
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24. The Registry is directed to place a copy of this order in
each of the connected matters.
Sd/-
(A. S. SUPEHIA, J)
Sd/-
(PRANAV TRIVEDI,J)
MAHESH/75
