TaxTMI 
TaxTMI 
2017 (3) TMI 1710
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....s case are different from the facts of the above case laws. 3. On the facts and in the circumstances of the case in law, the Ld. CIT(A) has grossly erred in not appreciating the fact that the notice under Sec.133(6) issued to the parties from whom alleged bills were received were returned undelivered by the postal authorities and spot verification by the inspector of this circle, revealed that no business is carried out from these premises. 4. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has grossly erred in not appreciating the fact that the assessee was not able to produce the parties from whom alleges bills were received, before the Assessing Officer, despite specific opportunities being accorded to him, vide Show Cause Notice dated 11.02.2013. 5. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has grossly erred in not appreciating the fact that the assessee failed to rebut the findings of Sales Tax Department vis-àvis bogus purchase despite reasonable opportunity being accorded to him, vide Show Cause Notice dated 11.02.2013. 6. On the facts and in the circumstances of the ca....
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....ee was not satisfied, therefore, the assessee filed an appeal before the CIT(A) who deleted the said addition. Therefore, the Revenue has filed the present appeal before us. ISSUE NO. 1 TO 8:- 4. Under these issues the revenue has challenged the deletion of the addition of an amount of Rs. 4,99,27,664/- on account of the purchase of materials. The assessee purchased the material from different parties. The Assessing Officer visited the official website of the Sales Tax Department, Government of Maharashtra www.mahavat.gov.in., in which the following parties were found in issuing the bills only without any delivery of goods or materials for a commission. S.No. Name and Address of the parties Amount (Rs.) 1 M/s. Aryen Sales Corpn. 132-A Aksar Bhawan, Bhagatwadi, Bhuleshwar, Mumbai - 400002 14,14,438 2 M/s. Balaji Traders D/102 Dharma Nagar, Opp. Jayraj Nagar, Off Link Road, Borivali (W), Mumbai - 400091 46,58,466 3 M/s. Bharat Enterprise A/104, Neha Kunj CHS Ltd., Pandeshwar Marg, Vasai (W), Thane 7,15,787 4 M/s.Foram Traders 1/9, Palm View CHS Ltd., Rajawadi, Vidyavihar, Mumbai- 400077 9,45,667 5 M/s. Hans Enterprises 22/24, R....
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....e genuine transaction. The assessee failed to produce the parties for verification and also failed to establish the genuineness of the purchases however claimed to make the payment to the parties through cheques. Thus, the Assessing Officer declined the claim of the assessee and added this whole purchases to the tune of Rs. 4,99,27,664/- to the income of the assessee. On appeal the CIT(A) deleted the same. Before going further it is necessary to advert the finding of the CIT(A) on record:- "5.3 I have carefully considered the assessment order vis-à-vis the written submissions filed by the Learned Authorised Representative of the appellant. The only issue under first six grounds of appeal is the disallowance of purchases amounting to Rs. 4,99,27,664/-. The Assessing Officer has added the same by treating the purchases as unexplained expenditure u/s.69C. It is further seen that notices u/s.133(6) were duly issued and served to the said suppliers. Thereafter, the Assessing Officer did not issue any summons to them. It is therefore, further seen that the appellant has discharged his burden of proving the existence and genuineness of the purchases claimed. It is further ....
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....to refute the claim of the assessee that the cash received by it against the cheque payments of Rs. 30,80,730 from two parties was utilized to purchase cloth from the grey market which was found recorded in the inventory of closing stock, it has to be accepted that the assessee did make cash purchases of Rs. 30,80,730 and therefore, the same cannot be treated as bogus purchases." Mere payment of VAT by the appellant for the default of the suppliers is not sufficient to treat the purchases as unexplained expenditure. The income tax is a self-contained code. Therefore, I am also strengthened by the judgment of the Hon'ble Bombay High Court in the case of M/s.Nikunj EXIMP Pvt. Ltd. (ITA appeal No.5604 of 2010) in which it is categorically held that, "the Assessing Officer as well as the Commissioner of Income Tax-(A) have disallowed the deduction on account of purchases merely on the basis of suspicion because the parties have not been produced before them. We find that the order of the tribunal is a well reasoned order, taking into account all the facts before concluding that the purchases were not bogus. No fault can be found with the order of the tribunal is a well as the genuinene....