2018 (11) TMI 1905

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.... circumstances of the case and in law the Id. CIT (Appeals) has erred in upholding the reassessment proceeding initiated u/s. 147 by the Id. A.O. on wrong facts and in unlawful manner. 2. That the id. C. I. T. (Appeals) has erred in confirming the disallowance made by the Id. A.O. of the entire purchases amounting to Rs. 15,89, 604/- from the suspicious hawala dealers disregarding the documentary evidences and quantity and quality wise stock tally and even not appreciating that part of such unconsumed purchases in the business activity at the year end to the extent of Rs. 1, 49/490/- were held in closing stock and duly credited in manufacturing and profit/loss account. Being alleged disallowance made and upheld by the lower income ....

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.... that it has made payments through banking channel. The AO, without recording any adverse comments on evidences furnished before him, simply made additions on the basis of information received from Sales-tax department. The Ld.CIT(A), after considering relevant submissions of the assessee observed that when there is a doubt cast on purchases from the said parties, it is the duty of the assessee to file complete details of purchases to prove beyond doubt that the said purchases are genuine purchases. Further, the AO has carried out necessary enquiries by issuing notices u/s 133(6), however, such notices were returned unserved. It is also an admitted fact that the parties have admitted before the Sales-tax department that they have issued acc....

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....ies and his order should be upheld. 7. We have heard both the parties and perused the materials available on record. The fact that three parties from whom the assessee stated to have purchased goods were appearing in the list of suspicious / hawala dealers prepared by Sales-tax department. It is also an admitted fact that notices issued u/s 133(6) were returned unserved by the postal authorities. Under these facts, the AO came to the conclusion that purchases from the so-called parties are non genuine in nature. At the same time, it is not the case of the AO that the said purchases were not supported by purchase bills or any other evidence. The assessee has produced copies of purchase bills and also filed payment proof to prove that paym....