2017 (5) TMI 1525

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....ted to have purchased goods worth Rs. 4,63,704/- from M/s. Tanvi Gems, Rs. 3,92,102/- from M/s. Laxmi Jewellers, Rs. 5,95,703/- from M/s. S.R. Gems and Rs. 20,946/- from M/s. S. Exports totaling Rs. 14,72,455/-. 2.1 Since the assessee failed to produce these parties before the AO and since the first three concerns were not found existed at the given address, the AO doubted the claimed purchases from them, the AO held the books of accounts defective. 2.1 The AO also noted that the wages claimed by assessee were not fully vouched. He accordingly rejected the books of account. The AO also observed that there was steep fall in G.P. rate as compared to preceding year. 2.2 During the year on the turnover of Rs. 8,21,44,932/- G.P. rate of 11.39%....

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....ainst the G.P. rate shown by the assessee was just and proper. Considering the above submissions, we do not find reason to interfere with the first appellate order so far as application of provisions of section 145(3) is concerned. There is no doubt that we have initially given full relief on such cases on the basis that the assessee had furnished all the necessary information supported with documents which could have been expected from a prudent purchaser to establish the genuineness of the claimed purchases from the named parties thus genuineness of the same cannot be doubted merely because those parties could not be produced or not found later on during the period of assessment proceedings. But while dealing with several similar matters....