9911796707
TMI Blog2012 (8) TMI 1034X X X X Extracts X X X X X X X X Extracts X X X X ..... of transport and supplying building material had shown substantial sundry creditors for purchases in respect of 16 parties, out of which purchases had been made during the year from 7 parties, most of which remained outstanding at the end of the year. The details have been given in para 4 of the assessment order. The A.O., therefore, with a view to verify the genuineness of the purchases, issued notices u/s.133(6) to these 16 parties which returned back unserved. The A.O., therefore, issued show cause notice to the assessee as to why the additions should not be made in respect of purchases and outstanding credit balances in respect of these parties. The assessee thereafter filed confirmations from the parties. The A.O. however noted that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Siddhivinayak Corporation 2051744 2004953 2 Naman Enterprises 1269911 1269911 3 Shakti Trading Co. 128894 980384 4 Sandesh Sales Coprn. 368508 666977 5 Navdeep Trading Co. 2455711 2307571 6 Padmavati Corporation 1117212 1117212 7 Om Corporation 1615935 1145482 Total 9007915 9492490 3. The assessee disputed the decision of the A.O. and submitted before the CIT(A) that the entire sales corresponding to the purchases had been recorded by the assessee in the books of accounts which had been accepted and, therefore, no addition could be made on account of purchases. The assessee also filed the confirmations from debtors regarding the sales made to them. The assessee placed reliance on several decisions of the Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee had declared GP rate of 8.79% as compared to 6.99% in the immediate preceding years and 7.97% in the subsequent year. In case, the disallowance made by the A.O. is confirmed, the GP rate comes to 51.8% which was not possible in the business being done by the assessee. It was also submitted that the CIT(A) had not considered the various details and evidences filed by the assessee in the form of paper book. The assessee had filed the copy of bank account for the subsequent period from 01.04.2009 to 31.03.2011 to show that the payment had been made to the creditors in respect of which purchases had not been accepted by the A.O. These have been placed at pages 124 to 157 of the paper books. The assessee had also filed confirm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... done even after the A.O. pointed out to the assessee that the parties were not found at the addresses given. The assessee had filed confirmation without any PAN numbers and on the addresses mentioned in the confirmation, the parties were not found. It was further submitted that once the purchases were not proved genuine, the A.O. was justified in making the additions. It was further submitted that the judgments relied upon by the AR were not relevant. He placed reliance on the judgment of Hon'ble High Court of Delhi in the case of CIT vs. La Medica (250 ITR 576) in which under similar circumstances in which sellers had been found non existent addition on account of purchase have been upheld. 5. We have perused the records and considere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ils submitted had not been examined by the CIT(A) and the addition had been confirmed in routine manner. The assessee has raised specific grounds stating that the copy of bank statements for the subsequent period showing payment made to the creditors as well as the confirmations filed from debtor showing sales made to them had not been considered by the CIT(A). 6. We have carefully considered the various aspects of the matter. The A.O. has made addition u/s.69C as unexplained expenditure on account of purchases. The A.O. has not disallowed the purchases as bogus. Since the sellers have not been found at the addresses given, the A.O. has concluded that the sellers were non existent and the assessee had made purchases from other parties on c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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