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2015 (3) TMI 970 - ITAT MUMBAIBogus purchases - Invocation of s. 145(3) - Assessing Officer is not satisfied about the correctness or completeness of the accounts of the assessee - Held that:- The assessee's account books are as kept and maintained in the regular course of its business, while the enquiry by the Revenue was only much later, in, as it appears, February, 2009, followed by notice u/s.133(6) on 05.03.2009. The transaction/s with MA, as per the assessee's books of account, occurred during the period 15.07.2006 to 04.09.2006, prior to the demise of its main person, i.e., Shri P. B. Maniar, on 16.09.2006. The plea of the successor being not, therefore, aware of the transactions, which are generally not recorded in accounts is not without merit. The assessee may have, as stated in the assessment order not reflected the name of MA in the details of sales made in excess of ₹ 1 lac each during the year, as furnished in the assessment proceedings. However, that could not hold against the assessee or lead to the inference of the purchases being bogus. If so, the sales thereto, also appearing in the same account (of MA), must equally be regarded as bogus. In fact, the objection is to no moment, as the assessee's books, including stock records, are matched, showing the purchase from and sale of goods to MA, so that notwithstanding the said non-reflection, the said transactions stood duly recorded in its accounts. The assessee does not gain in any manner from the said non-reflection; its accounts clearly showing the goods 'purchased' from as having been subsequently 'sold' to, MA, i.e., in the same quantity and at the same rate. In other words, the recording of the said transactions exhibits the authenticity of the said account, as it could have otherwise kept the same off its books, as did MA. The aspect of 'sales' to MA, an integral part of the assessee's explanation in support of its accounts, has been completely ignored by the Revenue. It, in our view, in acting in the manner it has, acted parochially and with a prejudiced state of mind.there is nothing to doubt the genuineness of the impugned entries of purchase. Accordingly, we set aside the invocation of s. 145(3) qua the assessee's accounts as also direct the deletion of the disallowance effected. - Decided in favour of assessee
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