Rajasthan High Court - Jodhpur
Pr Commissioner Of Income Tax vs M/S Samarpan Synthetics Pvt Ltd on 4 March, 2022
Bench: Akil Kureshi, Rekha Borana
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
D.B. Income Tax Appeal No. 17/2021
Pr Commissioner Of Income Tax, District Udaipur
----Appellant
Versus
M/s Samarpan Synthetics Pvt Ltd, 54, Bhilwara Textiles Market,
Pur Road, Bhilwara
----Respondent
For Appellant(s) : Mr. K.K. Bissa.
HON'BLE THE CHIEF JUSTICE MR. AKIL KURESHI
HON'BLE MS. JUSTICE REKHA BORANA
Order
04/03/2022
This appeal is filed by the revenue to challenge the judgment
of the Income Tax Appellate Tribunal.
Following questions are presented for our consideration.
"1. Whether on the facts and in the circumstances
of the case and in law, the ld. ITAT was justified in
confirming the order of the CIT(A) by deleting the
addition of Rs.7,82, 95,551/- as made by the AO u/s
69 of the Act, 1961 on account of purchases made
but not recorded the same in regular books of
account.
2. Whether the ITAT has failed to appreciate the
fact that the purchase of finished fabrics to the tune
of Rs.7,82,95,551/- was not entered in the books of
accounts and also sale thereof were made out of
books of accounts and thus the ITAT was not correct
deleting the addition of Rs.1,23,87,853/- as made by
the AO on account of profit against sale of
unaccounted purchases of goods?"
Though two questions have been made, the issue is single,
namely, deletion of a sum of Rs.7,82,95,551/- added in the hands
of the assessee by the assessing officer under Section 69 of the
Income-tax Act, 1961.
(2 of 3) [ITA-17/2021]
According to the assessing officer this sum represented the
assessee's unexplained investment. The Commissioner (Appeals)
and the Tribunal however deleted this addition on the ground that
the purchases were reflected in the books of accounts by the
assessee and were not made from unexplained sources. In
particular, the relevant portion of the judgment of the Tribunal
reads as under:-
"8. From perusal of the record, we noticed that the
entire addition made by the AO is on the basis of
purchase details of finished fabrics above Rs.1,00,000/-
submitted by the assessee vide letter dated 09.11.2018
along with the ledger account and sample bills. In this
letter details of 10 parties from whom purchase of
finished fabrics was made is given. This list includes
name of six parties from whom no purchases were in fact
made. Rather the purchases made from M/s Maximum
Synthetics Pvt. Ltd. Of Rs.10,00,68,034/- was bifurcated
in the name of these six parties as explained vide letter
dated 21.12.2018 and the details of the same are already
mentioned in earlier paragraph of this order.
9. We also observe from the record that quantity and
the amount of purchases made from M/s Maximum
Synthetics Pvt. Ltd. is duly recorded in the regular books
of accounts and the same is also supported by the stock
records. Only for the bank purpose, purchase is shown
to the banker in seven names including M/s Maximum
Synthetics Pvt. Ltd. as the assessee was under the
apprehension that if purchase from one party of Rs.10 cr.
is shown to the bank it may lead to adverse opinion from
the bankers for grant of limit inasmuch as the banker
may take a view that assessee is mainly dependent on
purchases from one supplier only and therefore the said
bifurcation was provided to the bank which was also
submitted to the AO but the fact remains is that no
purchase is made from these six parties and therefore,
the same is not part of books of accounts."
It could thus be seen that the entire issue is based on facts.
The Commissioner (Appeals) and the Tribunal concurrently came
to findings of facts which are not perverse. The Tribunal in the
above quoted portion of the order has accepted the explanation of
(3 of 3) [ITA-17/2021]
the assessee that the entire purchase was made from M/s.
Maximum Synthetics Pvt. Ltd. and it was also duly recorded in the
regular books of accounts. However, the assessee had shown such
purchases from different parties only for the purpose of showing
the purchases from multiple sellers to the bank. This was done to
obtain higher spending limit from the bankers. No question of law
arises.
The appeal is dismissed.
(REKHA BORANA),J (AKIL KURESHI),CJ
10-a.asopa/-
Powered by TCPDF (www.tcpdf.org)
