TaxTMI 
TaxTMI 
2013 (10) TMI 1293
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.... of appeal, the only ground survives for our adjudication relates to sustenance of addition of Rs. 1,27,733 by the learned Commissioner of Income-tax (Appeals), which was made by the in respect of suppression of purchases. 3. The brief facts of the case are that the assessee is deriving income from medicine business on wholesale basis. He maintains regular books of account and accounts are audited by the chartered accountant under section 44AB of the Income-tax Act. The auditor has not made any adverse comments in their report as both purchases and sales are duly recorded in the purchase register and sales register. The assessee is purchasing medicines within the State of Orissa and medicines are subject to first point tax goods. The ass....
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....representative. 6. We have heard the learned Department representative and gone through the orders of the authorities below. We noted that the Assessing Officer has made the addition on account of unexplained investment due to difference in purchases made by the assessee as per the information given by various suppliers. It is not disputed that the assessee is dealing in medicines and medicines are first point tax goods. From the orders of the Assessing Officer, it is not clear whether suppliers have shown more sales to the assessee or whether suppliers have shown lesser sales to the assessee and whether the assessee has shown more purchases. The addition has been made merely observing that there is difference in the purchase figure as s....
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....have not made purchases. Subjection whatever wrong may be, it cannot take the shape of actuality. If the Assessing Officer did not agree with the purchases made by the assessee, the onus is on the Assessing Officer to prove by bringing relevant material that in fact the assessee has made purchases. Merely there is a difference in the reconciliation of the accounts of the suppliers and the assessee, it cannot be presumed that the assessee has made purchases outside the books of account. Under these facts and circumstance, we are of the opinion that it is not a fit case that the addition can be sustained. We, accordingly, delete the addition of Rs. 1,27,733. 7. In the result, the appeal filed by the assessee is allowed. I. T. A. No. 58/....
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....rofit in the manner given under section 144 of the Act. Reliance was placed on various decisions of the hon'ble High Courts that once an assessment is made by estimating the profit, no further addition can be made under section 40A(3) of the Act. 10. The learned did not agree with the submission of the assessee and on perusal of the photocopies of the ledger account, took the view that the assessee has made payment to M/s. Gargee Chemicals in excess of Rs. 20,000 in violation of section 40A(3) even though each of the payment (as we observe from the order of the learned does not exceed Rs. 20,000 although the aggregate payment on a particular date) exceed Rs. 20,000. Thus, the learned took the view that the order passed by the Assessi....