2017 (8) TMI 1311

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....in law, the Ld. CIT(A) has erred in granting relief of Rs. 5,93,67,68/- by restricting the addition @ 4.92% of total purchases from hawala parties." 2. The short facts of the case is: Briefly stated, the facts of the case are that the appellant is a Proprietor of M/s. Royals Corporation and supplier of electrical hardware & General items. The return of income was filed on 15.10.2010 declaring total income at Rs. 26,05,809/-. During the course of assessment proceedings, to ascertain the genuineness of purchases, notices u/s. 133(6) were issued to 14 parties. Some of these notices have been returned back by the postal authorities with remark 'non known', 'no such address' or no compliance has been made. The appellant was given an opportuni....

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....'ble Supreme Court in Kachwala Gems 288 ITR 10(SC) that even payment by account payee cheques is not sufficient to establish that purchases are genuine. The AO disallowed on account of bogus purchases at Rs. 6,80,72,143/-. 3. The matter carried to CIT(A) and CIT(A) has partly allow the appeal as under: "5.10 In the instant case, the appellant is not in a position to prove the existence of the suppliers. There is enough circumstantial evidence casting a doubt on the nature of the transaction. I am of the firm belief that the appellant had made cash purchases from other parties which were not recorded in the books. The appellant took only bills from these 11 parties as accommodation to explain the purchases. However, the entire purchase fr....