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2019 (4) TMI 757 - AT - Income TaxBogus purchases - non-service of notice u/s 133(6) to the suppliers - HELD THAT:- CIT(A) after considering all these facts has recorded categorically finding of the fact that no contrary evidence has been brought on record by the AO to prove that purchases from above two parties are non-genuine except non-service of notice u/s 133(6). On the other hand, the assessee has filed complete details along with stock register execise audit report and transportation documents to prove that these purchases are genuine. Therefore, there is no error in the findings recorded by the Ld. CIT(A) in deleting the additions towards 25% of unverifiable purchases. Hence, we reject the ground taken by the Revenue. Unexplained cash credit u/s 68 - none of the parties were responded in response to summons issued u/s 131 - HELD THAT:- Where the assessee has taken loans from genuine parties which were verified in the previous financial year, but for changed circumstances, the AO has taken different view to make additions u/s 68 then no additions could be made when the credit has been brought out from previous financial year. In this case, it is undoubtedly proved that those companies are hawala operators involved in providing accommodation entries. When facts gathered during the course of assessment proceedings clearly proves that these are accommodation entry providers, the ratio laid down by Hon’ble Delhi High Court USHA STUD AGRICULTURAL FARM LTD. [2008 (3) TMI 91 - DELHI HIGH COURT] cannot be applied to delete additions. Accordingly, we are of the considered view that Ld. CIT(A) was erred in deleting additions made towards loans from M/s Chandimata Management Pvt. Ltd. and M/s Max Worth Project Pvt. Ltd. Hence, we reverse findings of the CIT(A) and sustained additions made towards loan taken from above two companies. DR failed to controvert the findings recorded by the CIT(A) in light of evidences filed by the assessee in respect of parties. On the other hand, AR for the assessee has also failed to file further evidence in respect of three parties, where the CIT(A) has confirmed addition to justify loans taken from the above parties. Therefore, we are of the considered view, there is no error in the findings recorded by the CIT(A) in respect of unsecured loans taken from these parties and accordingly we are inclined to upheld the findings of the CIT(A) and rejected ground taken by the Revenue as well as the assessee. Adhoc disallowance of certain expenses - HELD THAT:- CIT(A) has recorded categorical finding that the assessee neither submitted bills and other evidences nor address of person to whom such payments were made. Further, the assessee failed to prove above expenses are incurred wholly exclusively for the purpose of business of the assessee. Before us no change in facts. The assessee has failed to provide any evidence to prove that findings of facts recorded by the Ld. CIT(A) are incorrect. CIT(A) was right in confirming additions made by AO towards ad-hoc disallowance of expenses. Hence, we are inclined to uphold findings of the CIT(A) and reject ground taken by the assessee.
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