TMI Blog2018 (1) TMI 713X X X X Extracts X X X X X X X X Extracts X X X X ..... ackdrop of the view taken in the case of Simit P. Sheth (2013 (10) TMI 1028 - GUJARAT HIGH COURT), keeping in view the fact that the assessee had mainly purchased acids or corrugated boxes from the aforementioned parties, on which the VAT rates during the year under consideration, viz. F.Y. 2008-09 was 4% and 5%, respectively, therefore, keeping in view certain other monetary benefits which the assessee would had made from making such purchases, therefore, restrict the addition in the hands of the assessee to the extent of 6% of purchases of ₹ 29,81,640/-. We thus restrict the addition in the hands of the assessee to ₹ 1,78,900/- [i.e 6% of ₹ 29,81,640/-]. The order of the CIT(A) is thus modified to the said extent. - Decided partly in favour of assessee. - ITA No. 1022/Mum/2015 - - - Dated:- 27-12-2017 - SHRI R.C SHARMA,AM AND SHRI RAVISH SOOD, JM For The Appellant : Sh. K. Gopal Ms. Neha Paranjpe, A.Rs. For The Respondent : Shri Rajesh Kumar Yadav, D.R. ORDER PER RAVISH SOOD, JUDICIAL MEMBER: The present appeal filed by the assessee is directed against the order passed by the Commissioner of Income Tax (Appeals)-9, Mumbai, dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harat Enterprises ₹ 5,02,679/- 2. Trishna Multitrade Pvt. Ltd. Rs.14,08,945/- 3. Magnitude Trading Pvt. Ltd. ₹ 5,06,102/- 4. Larchan Trading Pvt. Ltd. ₹ 3,41,146/- 5. Carolin Enterprises ₹ 30,160/- 6. Sangura Trading Pvt. Ltd. ₹ 50,440/- 7. P.Y Distributors P. Ltd ₹ 1,42,168/- Total Rs.29,81,640/- therefore, in order to verify the genuineness and veracity of the said purchase transactions called upon the assessee to place on record documentary evidence, viz. copies of purchase orders, bills raised, nature of expenditure etc. The assessee in compliance to the directions of the A.O furnished details of purchases, material inward note and bank statement evidencing the payment of the purchase consideration to the aforesaid parties. The assessee in order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... parties; (viii). that payment by account payee cheques to the aforesaid parties would not conclusively establish the genuineness of the purchases; and (ix). the failure on the part of the assessee to produce the aforesaid parties further proved the fact that no genuine purchases were made by the assessee, therefore, concluded that the assessee had not made any genuine purchases from the aforesaid parties and added the aggregate of the value of purchases of ₹ 29,81,640/- to the income of the assessee. 5. Aggrieved, the assessee carried the matter in appeal before the CIT(A). The CIT(A) after deliberating on the facts of the case concluded that the assessee had failed to place on record any clinching documentary evidence, which would prove that the assessee was in actual receipt of material from the aforementioned parties. The CIT(A) observed that unlike as in the case of genuine purchase bills, there was no mention of the mode of delivery (transport) on the bills of the aforesaid parties. The CIT(A) further observed that as the assessee had neither placed on record documentary evidence to substantiate the veracity of the purchase transactions, nor produced the parties for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business of the assessee and thus formed part of its duly recorded sales, therefore, the addition of the entire purchase consideration could not have been made, relied on the order of a coordinate bench of the Tribunal, viz. ITAT, H Bench in the case of Haresh A. Rohra Vs. ITO [ITA No. 4563/Mum/2015; dt. 05.06.2017]. Per contra, the ld. Departmental representative (for short D.R ) submitted that the information gathered by the A.O from the Sales Tax authorities that the aforesaid parties were only providing accommodation bills and the assessee had not made any genuine purchases from them, stood established from the fact that the notices sent by the A.O to all of the said parties u/s 133(6) were returned unserved by the postal authorities. The ld. D.R submitted that independent of the information received by the A.O from the Sales Tax department, even otherwise the assessee had failed to substantiate the genuineness and veracity of the purchase transactions under consideration. The ld. D.R further submitted that the payments made by the assessee to the aforesaid parties vide cheques could not be held as sacrosanct and as a clinching evidence of the genuineness of the purchase tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e while computing its income, therefore, it was for him to establish the genuineness of the same to the satisfaction of the A.O. We are of the considered view that in the backdrop of the facts emerging from the record, viz. (i). the notices sent by the A.O to the parties were returned unserved by the postal authorities; (ii). neither of the aforesaid parties were produced for examination before the A.O; and (iii). the purchase bills unlike genuine bills did not mention of the mode of delivery (transport), the veracity of the information received from the Sales Tax department that the assessee had only taken accommodation bills and not carried out any genuine purchases further stood fortified. 8. Be that as it may, we cannot remain oblivious of the fact that the book results of the assessee which are found to be conformity with that of the preceding year, therein establishes that the purchases of the goods under consideration were consumed in the course of the business and the corresponding sales stood duly recorded. We find that the sales of the assessee had not been rejected by the A.O. We are of the considered view that in the backdrop of the aforesaid facts as had emerged fro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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