TMI Blog2015 (3) TMI 970X X X X Extracts X X X X X X X X Extracts X X X X ..... ccount (of MA), must equally be regarded as bogus. In fact, the objection is to no moment, as the assessee's books, including stock records, are matched, showing the purchase from and sale of goods to MA, so that notwithstanding the said non-reflection, the said transactions stood duly recorded in its accounts. The assessee does not gain in any manner from the said non-reflection; its accounts clearly showing the goods 'purchased' from as having been subsequently 'sold' to, MA, i.e., in the same quantity and at the same rate. In other words, the recording of the said transactions exhibits the authenticity of the said account, as it could have otherwise kept the same off its books, as did MA. The aspect of 'sales' to MA, an integral part of the assessee's explanation in support of its accounts, has been completely ignored by the Revenue. It, in our view, in acting in the manner it has, acted parochially and with a prejudiced state of mind.there is nothing to doubt the genuineness of the impugned entries of purchase. Accordingly, we set aside the invocation of s. 145(3) qua the assessee's accounts as also direct the deletion of the disallowance eff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt/s (at a total of ₹ 2,76,812 / PB pg. 8), was submitted in support. The main person, Shri Pravinchandra B. Maniar, looking after the affairs of MA, had since expired (on 16.09.2006), and it was this that was responsible for the disclaimer by the person now in-charge of the said firm, his son, being not aware of the transaction/s. Copy of the death certificate of Late Shri P. B. Maniar was furnished in support (PB pg.1). The same did not, however, find favour with the Assessing Officer (A.O.), who, rejecting the assessee's books of account u/s.145(3) of the Act, made disallowance to the extent of the said purchases, inferring them as bogus. The assessee reiterated its case in appeal, also relying on the reply to its letter dated 21.09.2007 to AGM (Sales), MTNL with regard to the lost Trump recharge and VCC coupons. As informed by MTNL, the lost cards had been issued to another distributor, MA, and which would thus prove the assessee's case in-as-much as the cards issued to MA could only be sold by it (assessee) if its' claim of loan of goods there-from was true. The same, as well as the ledger account of MA as appearing in the assessee's books, were dismissed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l or low on the relevant dates, so that it could not have made the sales of the said goods in its absence? Correspondingly, was the 'loaner', i.e., MA, sufficiently stocked qua the said goods on the relevant dates? That is to say, would its stock (of the relevant cards/coupons) fall to nil or even negative if the goods stated to be loaned to the assessee were indeed recorded by it in its stock records on those dates. This is as, firstly, the assessee could not possibly have access to the loaner's records and, further, nobody would possibly loan to another if it is not adequately stocked in respect of the said goods, or even at the risk of loss of its' own sales, by allowing the stock level to fall to nil or to precariously low levels. In fact, it is quite possible that the stock records of MA reflected the entries of delivery and receipt, yet denied the transactions, being unofficial. Then, did the assessee's purchase and sale returns for the relevant period (July to September, 2006), as furnished to the concerned authorities, were at an amount/s in agreement with its books of account and, further, bore the name of MA as the supplier or buyer, as the case may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppliers or buyers. Why would a distributor purchase goods from another? Then, again, why would he sell it without normal profit? The assessee's account books are as kept and maintained in the regular course of its business, while the enquiry by the Revenue was only much later, in, as it appears, February, 2009, followed by notice u/s.133(6) on 05.03.2009. The transaction/s with MA, as per the assessee's books of account, occurred during the period 15.07.2006 to 04.09.2006, prior to the demise of its main person, i.e., Shri P. B. Maniar, on 16.09.2006. The plea of the successor being not, therefore, aware of the transactions, which are generally not recorded in accounts is not without merit. Did the assessee deliberately record the purchases and sales on those dates, which are ostensibly guided by its stock levels on those dates? Then, again, how could the letter dated 21.09.2007 to MTNL, receipted by the addressee on the same date, be an afterthought? Even so, what prevents the Revenue to seek confirmation of the stated reply thereto from MTNL itself, i.e., as claimed by the assessee, as being actually so and, further, as being in conformity with the MTNL's records. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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