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2021 (5) TMI 786 - ITAT SURATBogus purchases - AO disallowed the 25% of the purchases merely on the ground that the assessee failed to produce the parties for verification by relying on the decision of Vijay Proteins [1996 (1) TMI 144 - ITAT AHMEDABAD-C] - CIT-A deleted the addition - HELD THAT:- As noted that before Ld. CIT(A), as well as before us the Ld. AR of the assessee stated that he has filed sufficient evidences, which includes the confirmations of the parties, copy of the bank statements of the parties at Surat as well as Mumbai. We have seen that no findings on these evidences were given by assessing officer. AO disallowed the 25% of the purchases merely on the ground that the assessee failed to produce the parties for verification by relying on the decision of Vijay Proteins (supra). The assessee filed the copy of bank statement of the parties. AO has not investigated if the amount paid by the assessee was recycled back to the assessee. Assessee has relied on the decision of Tejua Rohit Kumar Kapadia [2017 (10) TMI 729 - GUJARAT HIGH COURT] wherein the appeal of revenue was dismissed by High Court. In the said appeal, the revenue assailed the order of Tribunal on deleting the partial disallowances of the purchases. The Hon'ble High Court held that when the assessee is trader and have shown the sales out of the purchases, which have been accepted by revenue and there was no evidence to show that the amount was recycled back to the assessee. Therefore, considering the decision of High Court of similar set of facts, we do not find any merit in the grounds of appeal raised by the revenue. No contrary fact or law is brought to our notice to take other view. Hence, we affirms the order passed by ld. CIT(A). In the result this ground of appeal raised by the revenue is rejected. Difference of closing balance of one of the party - AO rejected the books of accounts before making such addition - CIT-A deleted the addition - HELD THAT:- No specific reason for rejecting the books of account was recorded by the assessing officer. The ld. CIT(A) deleted the additions by taking view that the assessee filed confirmation of Ratan Export during the assessment. AO has not made investigation at Surat addresses, if he has any doubt regarding the existence of the party; the assessing officer ought to have made further investigation. It was further held that after knowing the fact that the party was having the same PAN, the assessing officer could have reconfirmed about the party. As further noted that despite filing the confirmation of Ratan Export the assessing officer has not referred the same in his order. The assessing officer simply held that the assessee filed its explanation only when the issue was brought to his notice and rejected the books of accounts and simply made addition of the difference, without considering the confirmation. No ground for rejection of books of account is recorded by assessing officer. In our view the ld CIT(A) has considered the facts and held that no addition on account of differential amount can be made. No contrary fact is brought to our notice to take other view. Hence, we affirm the order of ld CIT(A). In the result this ground of appeal is also rejected. Appeal of the revenue is dismissed.
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