"आयकर अपीलीय अधिकरण \nगुवाहाटी पीठ, कोलकाता में \nIN THE INCOME TAX APPELLATE TRIBUNAL \nGUWAHATI BENCH AT KOLKATA \n[वर्ुुअल कोटु] \n[Virtual Court] \nश्री मनमोहन दास, न्याधयक सदस्य \nएवं \nश्री राक\nेश धमश्रा, लेखा सदस्य \nक\nे समक्ष \nBefore \nSHRI MANOMOHAN DAS, JUDICIAL MEMBER \n& \nSHRI RAKESH MISHRA, ACCOUNTANT MEMBER \nI.T.A. Nos.: 217, 218 & 219/GTY/2024 \nAssessment Years: 2013-14, 2014-15 & 2016-17 \nI.T.A. Nos.: 220 & 222/GTY/2024 \nAssessment Year: 2017-18 \nI.T.A. Nos.: 221 & 223/GTY/2024 \nAssessment Year: 2018-19 \nJayanta Khaund \nVs. \nACIT, CIR-1, Guwahati \n(Appellant) \n(Respondent) \nPAN: AKKPK7824L \nAppearances: \nAssessee represented by \n \n: Sweta Jain, FCA. \nDepartment represented by \n: Kausik Ray, JCIT \nDate of concluding the hearing \n: March 10th, 2025 \nDate of pronouncing the order \n: March 21st, 2025 \nORDER \nPER RAKESH MISHRA, ACCOUNTANT MEMBER: \n \nThese appeals filed by the assessee are against separate orders of \nthe Ld. Commissioner of Income Tax-NFAC, Delhi [hereinafter referred \n\n \nPage | 2 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \nto as ‘the Ld. CIT(A)’] passed u/s 250 of the Income Tax Act, 1961 \n(hereinafter referred to as ‘the Act’) for AY 2013-14 to AY 2018-19 dated \n17.09.2024. Since the issues are common, therefore, all these appeals \nwere taken up together, heard together and are being decided vide this \ncommon order for the sake of convenience and brevity. \n2. \nThe assessee is in appeal before the Tribunal raising the following \ngrounds of appeal: \n“ITA No. 217/GTY/2024: \n1. For that the initiation of reassessment proceeding on 28-07-2022 by issue \nof notice u/s 148 is bad in law and as such assessment order based on \nsuch illegal notice is liable to be annulled. \n2. For that under the facts & circumstances of the case, learned A.O. is not \njustified in initiating reassessment proceeding. \n3. For that the learned A.O. is not justified in making addition of \nRs.64,64,610/- u/s 68 of I.T. Act after holding the same as not genuine \nexpenditure. \n4. The Appellant craves the leave to take Additional Grounds and/or amend \nthe above grounds of appeal at the time of hearing of Appeal. \nITA No. 218/KOL/2024: \n1. For that the initiation of reassessment proceeding on 28-07-2022 by issue \nof notice u/s 148 is bad in law and as such assessment order based on \nsuch illegal notice is liable to be annulled. \n2. For that under the facts & circumstances of the case, learned A.O. is not \njustified in initiating reassessment proceeding. \n3. For that the learned A.O. is not justified in making addition of \nRs.7,29,96,131/- u/s 68 of I.T. Act. \n4. The Appellant craves the leave to take Additional Grounds and/or amend \nthe above grounds of appeal at the time of hearing of Appeal. \nITA No. 219/GTY/2024: \n1. For that the initiation of reassessment proceeding on 28-07-2022 by issue \nof notice u/s 148 is bad in law and as such assessment order based on \nsuch illegal notice is liable to be annulled. \n\n \nPage | 3 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \n2. For that under the facts & circumstances of the case, learned A.O. is not \njustified in initiating reassessment proceeding. \n3. For that the learned A.O. is not justified in making addition of \nRs.3,55,59,580/- u/s 68 of I.T. Act after holding the same as not genuine \nexpenditure. \n4. The Appellant craves the leave to take Additional Grounds and/or amend \nthe above grounds of appeal at the time of hearing of Appeal. \nITA No. 220/GTY/2024: \n1. For that the initiation of reassessment proceeding on 28-07-2022 by issue \nof notice u/s 148 is bad in law and as such assessment order based on \nsuch illegal notice is liable to be annulled. \n2. For that under the facts & circumstances of the case, learned A.O. is not \njustified in initiating reassessment proceeding. \n3. For that the learned A.O. is not justified in making addition of \nRs.2,90,16,960/- u/s 68 of I.T. Act after holding the same as not genuine \nexpenditure. \n4. The Appellant craves the leave to take Additional Grounds and/or amend \nthe above grounds of appeal at the time of hearing of Appeal. \nITA No. 221/GTY/2024: \n1. For that under the facts & circumstances of the case, learned A.O. is not \njustified in initiating reassessment proceeding. \n2. For that the learned A.O. is not justified in making addition of Rs. \n19,93,72,482/- u/s 68 of I.T. Act. \n3. The Appellant craves the leave to take Additional Grounds and/or amend \nthe above grounds of appeal at the time of hearing of Appeal. \nITA No. 222/GTY/2024: \n1. For that under the facts & circumstances of the case learned A.O. is not \njustified in levying penalty u/s 270A of Rs.2,32,362/- \n2. The Appellant craves the leave to take Additional Grounds and/or amend \nthe above grounds of appeal at the time of hearing of Appeal. \nITA No. 223/GTY/2024: \n1. For that under the facts & circumstances of the case learned A.O. is not \njustified in levying penalty u/s 271AAC(1) of Rs.21,39.825/-. \n\n \nPage | 4 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \n2. The Appellant craves the leave to take Additional Grounds and/or amend \nthe above grounds of appeal at the time of hearing of Appeal.” \n \n \n3. \nWe will take up ITA No. 217/GTY/2024 as the lead case. Brief \nfacts of the case are that in AY 2015-16 the case was selected for limited \nscrutiny through CASS and the assessment was completed u/s 143(3) \non 26.12.2017 assessing total income at Rs. 2,48,08,760/- after making \naddition of Rs. 1,88,60,982/- on account of bogus purchases (liability \nshown as sundry creditors) claimed during the period from 01.04.2014 \nto 31.03.2015. The addition was made as the assessee failed to produce \nany evidence in support of the claim of purchases made and the \nexistence of the sundry creditors could not be proved in spite of he \nhaving been provided several opportunities. Aggrieved with the \nassessment order, the assessee filed an appeal before the Ld. CIT(A). \nDuring the course of the appeal, several opportunities were afforded to \nthe assessee to prove the claim on the purchases made by the assessee \nduring the year and consequential sundry creditors raised on account \nof the same. The assessee was also given an opportunity to produce the \nsupporting bills & vouchers and payment details for the above and \naccordingly summons u/s 131 of the Act was issued by the DCIT, \nCircle-1, Guwahati on 31.01.2019 and the assessee was requested to \nproduce the details/documents, subsequent payments along with \nsupporting bank statements and books of account for the purchases \nmade during FY 2014-15 from Shri Toko Kach, Neelam Tain, Gem Taje \nand M/s. Tagum Enterprises, the bills and vouchers of which were \nproduced as additional evidence before the Ld. CIT(A). The assessee \nfailed to produce the required details which were called for and could \nproduce nothing in spite of several opportunities being afforded. The Ld. \n\n \nPage | 5 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \nCIT(A) passed an order dated 17.09.2024 confirming the addition of Rs. \n1,88,60,982/- on account of bogus purchases (liability shown as \nSundry Creditors) and further enhancement of Rs. 6,80,71,300/- u/s \n41(1) read with section 251(2) of the Act. While enhancing the addition \nthe Ld. CIT(A) had given the following directions: \n“Further, in view of the fact that the Appellant could not furnish Bills and \nVouchers both during the course of assessment proceedings as well as \nappellate proceedings, it emanates that the Appellant has not maintained \nany books of Accounts. Accordingly, the AO is directed to re-assess the \nincome of the Appellant for the previous years as well as subsequent years \ni.e. 2013-14, 2014-15, 2016-17, 2017-18 and 2018-19 in accordance with \nthe provisions of law.” \n4. \nAccordingly, following the due procedure as prescribed by the \namended provisions relating to reopening u/s 148A of the Act, the Ld. \nJurisdictional Assessing Officer issued a show-cause notice u/s 148A(b) \nto the assessee on 01.06.2022. Subsequently, a notice u/s 148 of the \nAct was also issued. The Ld. AO has given details on page 3 of the \nassessment order of the various notices/communication issued to the \nassessee which were not responded. Subsequently a notice u/s 148 of \nthe Act was issued. For the AY 2013-14, the assessee had filed the \nreturn of income electronically on 08.11.2013 declaring total income of \nRs. 48,02,640/- and since the assessee failed to submit the requisite \ndetails evidencing the genuineness of the sundry creditors of Rs. \n3,15,29,860/- shown in the return of income, the assessment was made \nu/s 144 of the Act and a sum of Rs. 64,64,610/- was added to the \nreturned income of the assessee and total income was assessed at Rs. \n1,12,67,280/-. The Ld. AO made the addition as per para 3.4.10 of the \nsuspect order and the relevant portion of the assessment order is \nextracted as under: \n\n \nPage | 6 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \n“3.4.9 It is pertinent to note here that the assessee was required to furnish \nthe necessary details/explanation. The facts of the case are that the \nassessee has shown an amount of Rs.3,15,29,860/- as “Sundry Creditors” \nand Rs.8,05,46,338/- as “Contract Expenditure” in his books of accounts \nfor the year under consideration. However, he could not establish the \ngenuineness of his claim on the matter of the claim of purchases and \nconsequential liability shown as Sundry Creditors. The vital statistics of the \nassessee, as appearing in the profit & loss account & balance sheet in the \nreturn of income of the assessee are as under: \nAY. \nPurchases \nSundry Creditors Addition to \nSr. Creditors \nSales \nSundry \nDebtors \n2011-12 \n4,90,10,191 \n74,35,500 \nN.A. \n5,48,23,004 \nNIL \n2012-13 \n6,43,31,240 \n2,50,65,250 \n1,76,29,750 \n6,43,85,445 \nNIL \n2013-14 \n6,96,55,859 \n3,15,29,860 \n64,64,610 \n9,26,16,611 \nNIL \n3.4.10 The assessee has shown Sundry Creditors as on 31/03/2013 at \nRs.3,15,29,860/- which were Rs.2,50,65,250/- as on 31/03/2012. There \nis year on year increase in purchase of Rs.53,24,619/- whereas creditors \nhave increased from Rs.2,50,65,250/- to Rs.3,15,29,860/- i.e. an addition \nof Rs.64,64,610/- to the Sr. Creditors on year on year basis. It is pertinent \nto mention here that the assessee has shown Sr. Debtors at Rs. NIL for the \nyear under consideration as well as the preceding year. This indicates that \nthe outstanding creditors are non-genuine because there is no prudent \nreason for non-payment to such creditors as there are no outstanding \ndebtors. The assessee is unable to prove that these creditors are real as he \nhas not submitted any documentary evidences in this regard like name of \nthe purchase parties, PAN of the purchase parties, copies of ledger, \npurchase invoices, account confirmations, etc. The assessee was \nspecifically asked to prove the genuineness of such sundry creditors \nappearing in the books of account. However, the assessee has failed to \nfurnish any details in this regard. In view of the same, it is construed that \nthe creditors appearing in the books of accounts to the tune of \nRs.64,64,610/- are not real and genuine and hence, the expenditure \nclaimed in the books of account as ‘Purchases’ are treated as bogus/non-\ngenuine.” \n5. \nAggrieved with the assessment order, the assessee filed an appeal \nbefore the Ld. CIT(A). The Ld. CIT(A), vide the impugned order, has \nreproduced the assessment order of the Ld. AO from page 2 to page 9. \nOn page 9 relating to the statement of facts it is mentioned that the \nassessee has written “As per assessment order”. Thereafter, the Ld. \n\n \nPage | 7 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \nCIT(A) has noted in para 5 that several opportunities were provided \nincluding a show cause letter as to why the appeal of the assessee \nshould not be dismissed due to repeated non-compliances. But on the \nappointed date on 10.09.2024 the assessee chose to file adjournment \npetition again to avoid to appellate proceeding. Therefore, he decided \nthe appeal of the assessee on primary ground of non-compliance. As \nregards the merits of the case, the Ld. CIT(A) has mentioned as under \nand dismissed all the substantial grounds taken by the assessee by \nupholding the order of the Ld. AO: \n“6.5 On merits also, the appellant has no case. The main ground taken by \nthe appellant relates to addition of Rs.64,64,610/- u/s 68 of the I.T. Act, \n1961. It is seen from the assessment order that the case of the assessee \nappellant was reopened u/s 147 of the I.T. Act, 1961 to re-assess the \nincome for AY 2013-14 in compliance to the direction given by the CIT(A)- 1, \nGuwahati while adjudicating the appellant's own case for AY 2015-16. \nDuring the assessment proceedings, it was noticed by the Ld. AO that an \namount of Rs. 3,15,29,860/- was claimed as \"Sundry Creditors\" for FY \n2012-13. However, during the course of the proceedings, the appellant \nfailed to submit the requisite details evidencing the genuineness of the \nSundry Creditors shown in the Return of Income though several \nopportunities were provided by the Id. AO by issuing notices including show \ncause notices. It was seen that the appellant had shown Sundry Creditors \nas on 31/03/2013 at Rs. 3,15,29,860/- which were Rs. 2,50,65,250/- as \non 31/03/2012. There was year on year increase in purchase of Rs. \n53,24,619/- whereas creditors were increased from Rs. 2,50,65,250/- to \nRs. 3,15,29,860/- i.e. an addition of Rs. 64,64,610/- to the Sundry \nCreditors on year on year basis. It was also seen that the appellant had \nclaimed Sundry Debtors at Rs. Nil for the subject assessment year as well \nas the preceding assessment year. Since the appellant has failed to furnish \nany details and explanation in this regard. In view of the same, it was \npresumed that the creditors appearing in the books of accounts to the tune \nof Rs.64,64,610/- were not real and genuine and hence, the expenditure \nclaimed in the books of account as 'Purchases' were treated as bogus/non-\ngenuine. \nAccordingly, Rs.64,64,610/- was added back u/s 68 of the I.T. Act, 1961. \n \n\n \nPage | 8 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \n6.5.1 During the course of appellate proceeding, the appellant failed to \nexplain the grounds taken against the issues. The reason for addition was \nclearly mentioned in the assessment order. However, the appellant made no \neffort to counter the findings of the Ld. AO either by uploading relevant \ndocument(s) or explaining the matter in detail and chose to remain silent \nabout the issue. It is seen from the assessment order that the appellant \nfailed to respond against the opportunities including notices u/s 148, 142(1) \nand show cause notices provided to him during assessment proceedings. \nAlthough the appellant had claimed substantial amount of sundry creditors \nfor FY 2012-13, he failed to produce any documentary evidence before the \nLd. AO. During the course of appellate proceeding also the appellant was \nprovided several opportunities for uploading explanation along with \nsupporting evidence in support of grounds of appeal, however, he failed to \nsubmit any plausible explanation and supporting documents regarding \njustification of huge amount of sundry creditors. The appellant did not \ncomply with the departmental notices both during assessment proceedings \nas well as during appellate proceedings. Submitting adjournment petition \nrepeatedly without showing any reason or providing tentative date of \nsubmitting details with evidence cannot be anything but a ploy to \nwithholding the disposal of the case for as long as possible. In the show \ncause letter dated 29.08.2024 and letter dated 03.09.2024 issued in \nresponse to adjournment petition filed by the appellant, it was clearly \nmentioned that this was the final opportunity to upload details but the \nappellant merely filed an adjournment petition once again without showing \nany reason or time-frame. The appellant’s response is as good as non-\ncompliance. \n6.6 In view of this, I find no reason to interfere into the order of the Ld. AO \nand the same is upheld accordingly. Therefore, all the substantial grounds \ntaken by the appellant are dismissed. \n7. In the final result, order of the Ld. AO is upheld leading to simultaneous \ndismissal of the grounds of appeal taken by the appellant.” \n6. \nAggrieved with the order of the Ld. CIT(A), the assessee has filed \nthe appeal before this Tribunal. \n7. \nWe have heard the rival submissions and also gone through the \nfacts of the case. In the assessment order, the Ld. AO has compared the \npurchases and the net addition to the sundry creditors during the year \nwhich has been added to the income of the assessee. The creditors \n\n \nPage | 9 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \nappearing in the books of account to the tune of Rs. 64,64,610/- are \ntreated as not real and genuine and the expenditure claimed in the \nbooks of account as purchases is also treated as bogus/non-genuine. \nThe assessee had filed the return for A.Y. 2015-16 and the total income \nwas assessed at Rs. 2,48,08,760/- after making addition of Rs. \n1,88,60,982/- on account of bogus purchases (liability shown as \nsundry creditors) as mentioned in the assessment order. The addition \nwas made as the assessee failed to produce any evidence in support of \nthe claim of purchases made and the existence of the sundry creditors \ncould not be proved in spite of having been provided several \nopportunities. The Ld. CIT(A) also issued direction to reassess the \nincome of the assessee for several assessment years. Accordingly, the \ncase of the assessee was reopened. The Ld. AO has worked out the \ndifference of Rs. 64,64,610/- as the difference between the sundry \ncreditors as on 31.03.2013 and 31.03.2012 which are shown at Rs. \n3,15,29,860/- and Rs. 2,50,65,250/- respectively, and has treated the \nsame as the addition to sundry creditors. The corresponding purchases \nare shown at Rs. 6,96,55,859/- and Rs. 6,43,31,240/- respectively for \nthe two years. The sales are shown at Rs. 9,26,16,611/- and Rs. \n6,43,85,445/- respectively. There is no mention of any audit report or \nbooks of account being maintained by the assessee and even the names \nof the creditors which are held to be bogus have not been mentioned. \nThe sundry creditors during the year could be those carried forward \nfrom the earlier year or new creditors, some of whom could have been \npaid during the year as regards their dues. It is not evident from the \nassessment order as to which all of the sundry creditors have been \ntreated as not real and genuine and what is the nature of expenditure \nclaimed in the books of account as purchases which have been treated \n\n \nPage | 10 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \nas bogus/not genuine. The assessee has made sales but even the details \nof the business i.e. whether trading or manufacturing has not been \nmentioned. In the FY 2014-15 relevant to the AY 2015-16, there were \nspecific disallowances in the names of Shri Toko Kach, Neelam Tain, \nGem Taje and M/s. Tagum Enterprises, the bills and vouchers for which \nwere filed as additional evidence before the Ld. CIT(A). However, in the \nimpugned assessment year, the assessee could not furnish the bills and \nvouchers, both during the assessment proceedings as well as during the \nappellate proceedings. The Ld. CIT(A) has reproduced the assessment \norder but has not discussed the merits of the case and has merely \nconfirmed the finding of the Ld. AO. \n8. \nOnce the Ld. AO is of the view that sundry creditors are bogus, he \nought to have identified such bogus creditors and if the purchases are \nalso treated as bogus/non-genuine then either the details and nature \nof the purchases which are treated as bogus/non-genuine should have \nbeen identified or the books of account should have been rejected and \nprofit should have been estimated. The Ld. AO has also not made any \ncomparative study as to what is the normal profit in this line of business \nand if the purchases of Rs. 64,64,610/- are added to the gross profit \nshown by the assessee, then the gross profit rate goes up which figure \nhas also not been justified. The assessee also did not make proper \nsubmission before the Ld. CIT(A). It was the submission of the Ld. AR \nthat proper compliance could not be made before the Ld. CIT(A) as well \nas the Ld. AO, therefore, the matter may be remitted to the Ld. AO as \nthe assessee was having evidence to justify the income shown. Neither \nthe reasons for reopening have been mentioned in the assessment order \nnor the nature of the same is mentioned and the assessee has also \nquestioned the reopening as bad in law. Therefore, we are of the \n\n \nPage | 11 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \nconsidered view that since proper representation was not made before \nthe Ld. AO as well as the Ld. CIT(A), therefore, another opportunity may \nbe allowed to the assessee to file necessary evidence before the Ld. AO. \nHence, both the orders of the Ld. CIT(A) as well as the Ld. AO are hereby \nset aside with the direction that the assessee shall be provided an \nopportunity of being heard to file necessary evidence in support of the \nincome shown and also file necessary confirmation of the sundry \ncreditors. The Ld. AO shall thereafter pass a speaking order and in case \nthe assessee fails to furnish any evidence, he shall be at liberty to make \na best judgment assessment on the facts of the case and in accordance \nwith law. This is imperative since on the basis of the findings of AY \n2015-16, the assessments for other years have been reopened and the \nnature of addition on account of sundry creditors has also been worked \nout in a similar manner by considering the net addition to the sundry \ncreditors during the year. Hence, the appeal for A.Y. 2013-14, is allowed \nfor statistical purposes. \n9. \nSince the issues in all other cases are similar, hence the orders of \nthe Ld. CIT(A) as well as the Ld. AO for A.Ys. 2014-15, A.Y. 2016-17, \nA.Y. 2017-18, and A.Y. 2018-19 are also set aside and the Ld. AO is \ndirected to frame the assessment orders de novo after allowing another \nopportunity of being heard to the assessee. Hence, the appeals in ITA \nNos. 217, 218, 219, 220 and 221/Gau/2024 are allowed for statistical \npurposes. \n10. \nThe appeal in ITA No. 222/GTY/2024 relates to penalty u/s 270A \nof the Act while appeal in ITA No. 223/GTY/2024 relates to penalty u/s \n271AAC of the Act for the addition made u/s 68 of the Act. Since the \nassessment orders relating to these two assessment years have been set \n\n \nPage | 12 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \naside to be done afresh therefore, the consequential penalty orders are \nalso hereby set aside to be done afresh in accordance with law after the \nreassessments are done again and in accordance with law. \n11. \nIn the result, the appeals filed by the assessee in ITA Nos. 217 to \n223/GTY/2024 are allowed for statistical purposes. \nOrder pronounced on 21st March, 2025 under Rule 34(4) of the \nIncome Tax (Appellate Tribunal) Rules, 1963. \nSd/- \n \nSd/- \n[Manomohan Das] \n \n[Rakesh Mishra] \nJudicial Member \n \nAccountant Member \nDated: 21.03.2025 \nBidhan (P.S.) \n \n \n \n \n \n\n \nPage | 13 \nI.T.A. Nos.: 217 to 223/GTY/2024 \nAYs: 2013-14 to 2018-19 \nJayanta Khaund. \nCopy of the order forwarded to: \n \n1. Jayanta Khaund, 300B, Tribeni Complex, Gaur Pandu Road, \nAdabari, Guwahati, Assam, 781012. \n2. ACIT, CIR-1, Guwahati. \n3. CIT(A)-NFAC, Delhi. \n4. CIT- \n5. CIT(DR), Guwahati Benches, Guwahati. \n6. Guard File. \n//True copy // \nBy order \n \n \nAssistant Registrar \nITAT, Kolkata Benches \nKolkata \n"