TaxTMI 
TaxTMI 
2015 (11) TMI 20
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....gus purchases without appreciating the fact that during the assessment proceedings the assessee had failed to produce the parties in person to prove the genuineness of the purchases made from them? 2. The appellant prays that the order of the CIT(A) on the above grounds be set aside and that of the Assessing Officer be restored. 3. The appellant craves leave to amend or alter any grounds or add a new ground which may be necessary." Assessee, has raised following grounds of appeal in the cross objections filed by it: 1. On the facts and circumstances of the case and law the Ld. CIT (A) erred in estimating net profit at 11% on turnover of the appellant. 2. On the facts and circumstances of the case and l....
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....03.2013 to the assessee, asking it to produce the parties. However, till the date of assessment order it had not produced any of such parties. As stated earlier two parties had denied of any such transactions. In such circumstances transactions shown in the name of these seven parties were regarded sham transactions. Therefore, the AO disallowed entire purchases shown in these names, totaling to Rs. 3.09 Crores. 3. Aggrieved by the order of the AO, the assessee preferred an appeal before the First Appellate Authority (FAA). Before him, it was argued that that the AO had disbelieved the genuine transact - tions whereas purchases had been made from various parties in due course of business, that merely because of non-service of notices at ....
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....M.K, Brothers (163 ITR 249) = 2003-TIOL-441-HC-AHM-IT, Baiaji Textiles Industries (P.) Ltd. (49 ITD 177), Permanand (107 TTJ 395), Sagar Bose (56 ITD 561), Rajesh P Soni (100 TTJ 892). After considering the submissions of the assessee and the assessment order the FAA held that the assessee had shown purchases from seven parties, that such purchase of material were claimed to be used in construction business, that the assessee had not been able to produce the parties for examination by the AO, that genuineness of purchases could not be relied upon, that merely on the basis of details of PAN, name and addresses, purchases bills and payment through banking channel it could not be held that the purchases were genuine, that those were not the....
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.... of income. Referring to the records produced by the assessee, the FAA held that in the AY. 2009-10 gross profit was @ 18.10%, that Net profit @5.67% was shown by the assessee for the same year, that in the year under appeal GP and NP had gone down to 6.79% and 2.51% respectively, that the book result of the assessee could not be accepted as genuine. He further held that during the course of assessment proceedings itself the = had given a letter dated 24.01.2013, admitting the addition with reference to low G.P. / N.P. could be made, that N.P. in such case ranged 5% to 12%, that before the AO the = had submitted certain decision of the Tribunal, that it had also submitted the rate of N.P. to be adopted in the respective cases i.e. Modem Con....
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....en on entire turnover of Rs. 14,49,95,316/-, the addition would be of Rs. 1,59, 49,485/-, that it would cover the entire purchases made from SI and ASC, that it would also take care of inflation of rates or expenditure or suppression of profit. So, finally the FAA reduced the addition to Rs. 1.59 Crores. 4. During the course of hearing before us, Departmental Representative (DR) stated that the assessee had not produced the parties before the AO, that in four cases notices issued under 133 (6) remained unserved, that two of the suppliers had denied to have any transactions with the assessee, that AO had rightly added the purchases to the total income of the assessee. Authrorised Representative (AR) argued that out of the total purchase o....