TMI Blog2013 (10) TMI 1293X X X X Extracts X X X X X X X X Extracts X X X X ..... ant material that in fact the assessee has made purchases. Merely there is a difference in the reconciliation of the accounts of the suppliers and the assessee, it cannot be presumed that the assessee has made purchases outside the books of account. Under these facts and circumstance, we are of the opinion that it is not a fit case that the addition can be sustained. Jurisdiction under section 263 can be invoked if both conditions, i.e., that the order passed by the Assessing Officer is erroneous and it is prejudicial to the interests of the Revenue. If only one of the conditions is satisfied, the jurisdiction under section 263 cannot be invoked. We noted from the assessment order that the Assessing Officer has not made any disallowance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 09 against the order dated November 5, 2012 of the learned -Cuttack, in the matter of assessment under section 143(3) of the Income-tax Act, 1961. 2. The assessee has taken various grounds of appeal in the appeal. Since the assessee did not press other grounds of appeal, the only ground survives for our adjudication relates to sustenance of addition of ₹ 1,27,733 by the learned Commissioner of Income-tax (Appeals), which was made by the in respect of suppression of purchases. 3. The brief facts of the case are that the assessee is deriving income from medicine business on wholesale basis. He maintains regular books of account and accounts are audited by the chartered accountant under section 44AB of the Income-tax Act. The audit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls) confirmed the said addition. 5. None appeared on behalf of the assessee even though written submission was filed. We, therefore, proceed to dispose of the appeal after going through the written submission and looking into the submission made by the learned Department representative. 6. We have heard the learned Department representative and gone through the orders of the authorities below. We noted that the Assessing Officer has made the addition on account of unexplained investment due to difference in purchases made by the assessee as per the information given by various suppliers. It is not disputed that the assessee is dealing in medicines and medicines are first point tax goods. From the orders of the Assessing Officer, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it to be so. The burden lay on the Department to prove that the assessee made the purchases. In our opinion no addition can be made merely on the basis of assumption and presumption. There may be various reasons that other party might have shown sales to the assessee and in fact assessee would have not made purchases. Subjection whatever wrong may be, it cannot take the shape of actuality. If the Assessing Officer did not agree with the purchases made by the assessee, the onus is on the Assessing Officer to prove by bringing relevant material that in fact the assessee has made purchases. Merely there is a difference in the reconciliation of the accounts of the suppliers and the assessee, it cannot be presumed that the assessee has made purc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dger copy of account of two parties, the assessee has not violated the provisions of section 40A(3) of the Act and the assessee has accounted for net purchases after taking into account the discount received. The Assessing Officer has not accepted the book results but completed the assessment by estimating the profit in the manner given under section 144 of the Act. Reliance was placed on various decisions of the hon'ble High Courts that once an assessment is made by estimating the profit, no further addition can be made under section 40A(3) of the Act. 10. The learned did not agree with the submission of the assessee and on perusal of the photocopies of the ledger account, took the view that the assessee has made payment to M/s. Gar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in cash exceeds ₹ 20,000 to each payment made by the assessee in cash to each of the party does not exceed ₹ 20,000. In view of this, we are of the view that there is no violation of the provisions of section 40A(3) and, therefore, there is no error in the order of the Assessing Officer. We also noted from the assessment order that the Assessing Officer at page 4 had duly considered the discount given by the assessee and on this account, the Assessing Officer made the disallowance to the extent of ₹ 31,458. It is settled law in view of the decision of the hon'ble Supreme Court in the case of Malabar Industrial Co. Ltd v. CIT [2000] 243 ITR 83 (SC) that unless a view taken by the Assessing Officer is unsustainable in l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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