TMI Blog2013 (5) TMI 474X X X X Extracts X X X X X X X X Extracts X X X X ..... t it approved of best judgment assessment where the purchases could not proved by the assessee beyond doubt. Qua difference in the amount of purchases, resulting in a disallowance of Rs.2.39 lakhs - Held that:- When the assessee's accounts are considered as incorrect on the basis of the accounts of the corresponding party, the same becomes a material with the Revenue on the basis of which the assessee's books of account are being impugned by it. It was, therefore, incumbent on the Revenue to provide the assessee the same, which it has failed to, despite, repeated requests by the assessee for the same, as gathered from the statement of facts, as filed both during the course of proceedings in the first and the second round, as well as the arguments made before us - this issue is also likewise restore back to decide the same afresh. - ITA No. 7225/Mum/2011 - - - Dated:- 5-4-2013 - Shri Sanjay Arora, A. M. And Shri Vijay Pal Rao, J. M.,JJ. For the Appellant : Shri N. M. Porwal For the Respondent : Shri Ashim Modi ORDER Per Sanjay Arora, A. M.: This is an Appeal by the assessee agitating the Order by the Commissioner of Income Tax (Appeals)-25, Mumbai ('CIT(A)' f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee which it has failed to discharge. However, considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the matter to the file of the Assessing Officer with a direction to give one more opportunity to the assessee to substantiate with evidence to the satisfaction of the Assessing Officer regarding the difference in purchases from the first two parties and genuineness of the purchases from the other two parties. The Assessing Officer shall give due opportunity of being heard to the assessee and decide the issue as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes." Not much improvement could be made by the assessee in the set aside proceedings, both before the assessing authority as well as the first appellate authority, so that both the disallowances stood confirmed in the second round as well. Aggrieved, the assessee is in second appeal. 3.1 Before us, the principal argument by the ld. AR, the assessee's counsel, was that the disallowance has been made in respect of two parties, even as the assessee deals with and has purchased goods from as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pite the tribunal having allowed it a final opportunity to do so. None of the facts raised by the assessee per its arguments in the instant case find reflection or mention in the arguments before the authorities below and, consequently, in their orders, so that there are no findings by them in the matter. As such, no cognizance thereof could possibly be taken by the tribunal, proceedings before which are even otherwise limited in scope, inasmuch as they arise out of the findings by the tribunal in the first instance. 4. We have heard the parties, and perused the material on record. 4.1 We shall take up the principal issue, i.e., the disallowance of purchase for Rs.13.30 lakhs, first. The same is in respect of two parties, as under:- M/s. Am Pee Fabrics Rs.6,96,795/- M/s. Rinowa Creation Rs.6,32,880/- Notices to both the parties u/s.133(6) were returned unserved by the postal authorities. The assessee was unable to furnish the changed address, or even as much as their permanent account number (PAN), stating that it no longer had any relations with them (PB-I(A), pg. 22). It was under these circumstances that the disallowance came to be e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case. The matter and, thus, the issue at hand, i.e., the genuineness or otherwise of the purchases being claimed by the assessee, is, to our mind, principally factual. A decision in its respect would have to be arrived at by taking into account the totality of the facts and circumstances of the case. In this regard, no doubt the purchases cannot be inferred as bogus merely because of non-responses to the notices u/s.133(6). However, the moot question is, if the parties at all exist? If so, to whom the payments were made? There is nothing on record to establish the identity of the suppliers, viz. PAN, Sales Tax or Excise Registration, TIN, Land line No., Mobile No., etc. Even the names of the persons managing the affairs of the said firms, and with whom the dealings were made, either directly or through the brokers or commission agents involved, as is apparent from the bills produced, have not been divulged. This is surprising, particularly as the bank accounts in which the realization proceeds of the cheques per which the payments stand made were credited, would reveal the names of these persons. In fact, for all we know the said bank accounts may well be in operation as these ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mited scope of the instant proceedings before us. Clearly, if the goods stand transported as well as processed by third parties, with even duty having been paid on such processing, it cannot be said that no goods at all have been purchased. Further, as regards the 'fact' of sale, the same would become material only if the assessee could, with reference to its stock register or any other record, exhibit that the goods so purchased were either sold during the relevant year itself or, being unsold, stand included in the closing stock. It is only in either of these two situations, it may be appreciated, that a claim for purchase could be validly made. This matter, which we consider as relevant, though arising out of the record, has not investigated or examined by the authorities below. 4.5 In view of the foregoing, we only consider it fit and proper that the matter is restored back to the file of the first appellate authority for the purpose. The onus, there is no gainsaying, to establish its claims, would only be on the assessee. In this regard, we may advert to the decision by the hon'ble apex court in the case of Kachwala Gems vs. JCIT [2007] 288 ITR 10 (SC), whereat it approved o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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