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2015 (7) TMI 731 - AT - Income TaxAddition on account of bogus purchases - assessee disallowed 25% of the purchase price - CIT(A) deleted the addition - Held that:- The assessee miserably failed in this year to establish a reconciliation between the payments made by him towards purchases vis-à-vis the ultimate recipient of the amounts being his vendor. As far as the Asstt.Year 2001-02 is concerned, we find that in that year purchases were made from four parties. The assessee has demonstrated that the payments have been received by two parties. The ld. AO has accepted it as a fact. Thus, the assessee has proved on record that who was the ultimate recipient of the money that entity was found to be vendor of the assessee. There could not be any doubt about the purchases. Due to these reasons, the AO did not make any addition. The learned First Appellate Authority has not examined the facts with this angle, no reasoning is discernible in the findings extracted supra. The CIT(A) has observed that the AO has not found any instance whether the cheque issued by the assessee has been encashed on behalf of the assessee. It was for the assessee to establish how the payment was made to the ultimate seller of the goods. The assessee failed to establish this fact. The learned AO has made reference to the case of M/s.A.K.Textile, where the payments were withdrawn by the proprietor named “Aaisha”. These amounts have been doubted by the AO. It was for the assessee to explain as to how the payments are genuine and they were made to the supplier. No such assertions are discernible from the reply of the assessee extracted supra. Therefore, in our opinion, the learned CIT(A) has erred in deleting the addition. We set aside order of the learned CIT(A), and restore that of AO. - Decided in favour of revenue.
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