TaxTMI 
TaxTMI 
2016 (4) TMI 956
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....13 determining the income of the assessee at Rs. 28. 20 crores. 2. First ground of appeal is about deleting the addition made on account of unconfirmed purchases, amounting to Rs. 16,37,87,197/-. During the assessment proceedings the AO found that the assessee had shown sundry creditors of Rs. 10.15 crores. To verify the genuineness and credit -worthiness of the creditors, he called for information u/s. 133(6) from some of the parties, on test check basis, from whom the assessee had made purchases. He found that in most of the cases notices were served but the parties had not filed any details. The AO was of the opinion that purchases to the extent of Rs. 17.38 crores, in respect of 16 parties, had not been proved. He issued a show cause....
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.... suppliers were illiterate or not conversant with perfect account system, that out of the 16 suppliers 11 parties were fish suppliers, that as per the set procedure material arrival report was prepared at the factory site, that in the material arrival report details like varieties, accounts, weight agreed and total value of the goods was mentioned, that the report was countersigned by both the parties, that final material arrival report was being maintained by the assessee, that the AO had wrongly disallowed the genuine purchases and had brushed aside the reliable evidences, that by letter dt.27.2.2013 the AO was made aware of the submission of the confirmations, that in respect of differences in closing balance reconciliation statement had....
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....s during the course of scrutiny assessment, that vide letter dt.30.1.13 the assessee had furnished copies of raw material reports along with sample copies of invoices, that the AO had not asked to submit the stock register. After considering the submissions of the AO and the assessee, the FAA held that the AO had disallowed purchases of Rs. 17.38 crores without any valid reason and without rejecting the genuineness of the purchases, that the AO had not established the facts that the purchases made by the assessee were bogus, the assessee had been able to refute each and every argument with necessary evidence, that the AO vide its order 27.9.13 had rectified the mistakes u/s.154 of the Act, that the AO had reduced addition of Rs. 7.54 cr.....
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....hat six of the creditors were not fish suppliers, that question of submitting of raw material report in such cases did not arise, that the assessee had submitted copies of invoices during assessment proceedings and AO had accepted the factual positions, that the succeeding AO had made incorrect observation about invoices for purchases, that the AO had not called for the stock register, that there was difference of Rs. 9,154/- with regard to purchase expenditure, that the reconciliation about said transaction was filed. The FAA further held that AO had not rejected the veracity of books of account nor had made any observation of incorrectness or incompleteness of books of account u/s. 145(3) of the Act. The FAA referred to the case Sanchita ....
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.... successor AO alleged many an irregularities in the accounts maintained by the assessee, that the FAA has given categorical finding of fact about filing of confirmation letters of suppliers of fish along with details of their bank statement, copies of acknowledgment of income tax returns and reconciliation statement. He specifically mentioned that vide letters dated 27.2.13 and 23.9.2013 the AO had furnished all the necessary details. Before us, the DR on the basis of the assessment records, admitted that both the letters and the annextures to the letters were available on the file of the AO. In thses circumstances, we are of the opinion that the findings of facts recorded by the FAA with regard to the purchases in question present the true....