TaxTMI 
TaxTMI 
2016 (2) TMI 504
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....the Act, determining the income of the assessee at Rs. 4.03 Crores. 2. Effective ground of appeal is about confirming the disallowance of Rs. 1.47 Crores. During the assessment proceedings, the AO found that the assessee had purchased goods from Sendoz Steel (SS) and Ronak Industries (RI). As per the information received from Maharashtra Sales tax department purchases made by the assessee, from both the parties, were not genuine. He issued a show cause notice to the assessee as to why the purchases from SS and RI should not be treated as bogus. After considering the submissions made by the assessee, the AO added a sum of Rs. 1.47 Crores to the total income of the assessee and held that the suppliers had provided bills only and had not su....
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....at invoices of GIL were raised only in the months of December, 2009 to January, 2010, that there was no possibility of aluminium being used for the transmission material supplied by SS, that in the case of KIL raw material was purchased in the month of February that the goods were claimed to be manufactured in March, that considering the time gap it was not possible for the assessee to manufacture the same, that the assessee had not purchased any goods from RI in earlier years, that payments to the suppliers were made after six months, that over all picture showed that the purchases from the RI was bogus, that the assessee purchased goods from SS in the AY.s. 2009-10 and 2011-12, that purchases from SS were made from October 2009 to Februar....
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....ing hawala entries, that the AO made the addition to the income of the assessee treating the transactions with SS and RI as bogus purchases, that the FAA had confirmed the addition, that the assessee had furnished various documents before the AO and the FAA. We find that the AO had not rejected the books of account nor had doubted the sales made by the assessee to KIL and GIL. While going through the page Nos.26-27, we find that SS had delivered the goods at the workplace of the assessee and the number of tempo is also mentioned in it. Similar is the position about other purchases made from SS(Pg.No.28-51 of the PB). We find that the ledger account of RI and SS show that purchases were regularly made from both of them. It is also found that....
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.... specifically mentioned that delivery was made at the work place and that they did not charge transportation charges from the assessee. It is a fact that the goods manufactured by the assessee were supplied to parties who are in the field of transmission business. The AO/FAA have not made any enquiry with the recipient of the finished goods. In our opinion, the information received from sales tax was a good starting point for making further investigation, but it was not taken to the logical end. If the evidences produced by the assessee are vague against the conclusions drawn by the AO/ FAA it becomes clear that the assessee had discharged the burden cast upon it. Therefore, reversing the order of the FAA we decided the effective Ground of ....