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2018 (12) TMI 623 - ITAT DELHIBogus purchases addition - notices u/s 133(6) and local inquiries were conducted after 3 to 5 years from the year of purchases - Held that:- Nothing is left for the AO to make any addition against the assessee. It may also be noted here, that the AO recorded in the Assessment order when notice u/s 133(6) have been issued against the aforesaid parties but the notice return un-served with the remarks “left without address”. The parties existed at the address given by the assessee and that such enquiry letters have been issued after about 5 years of end of the assessment year. Therefore, same should not be considered adverse in nature against the assessee. Further, such reports and report of the Inspector for making local enquiry, according to the assessee have not been confronted to the assessee. Therefore, such material cannot be used in evidence against the assessee. AO did not make any further efforts to locate the seller parties for their appearance to examine the issue. The GP/NP rate is reasonably declared by the assessee. If the purchases are excluded, the Profit Rate would be very abnormal and would not be according to the norms of the industry. AO did not bring any evidence on record, if any heavy cash or heavy cash transactions are conducted by assessee. The AO merely on presumption noted that Sh. Vinod Parashar has made cash withdrawals which were returned to the assessee. There is no basis for making such an allegation against the assessee. It is well settled law that presumptions howsoever may be high but it cannot take placed on legal proof. Decided in favour of the assessee.
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