TMI Blog2009 (3) TMI 1003X X X X Extracts X X X X X X X X Extracts X X X X ..... he Tribunal that transactions were entered into with these suppliers during the financial year ending on 31-3-1996 and an inquiry was conducted in the year 2002 and it was not unusual for such small parties to have left in between. Thus, these two cases are at par with those in respect of which expenditure is allowed. The reason for disallowing expenditure in respect of other four parties was that when the notices were sent they were not available. we are of the opinion that even in their absence the assessee had produced sufficient material to show payments, namely the bank accounts of such parties. We are constrained to note that if the summons are not issued to those parties or the same could not be served at the given addresses, AO could have obtained their addresses from the banks as the bank statements were produced and could have made an endeavour to serve those parties at the said addresses. That the finding of fact arrived at by the Tribunal is plausible and based on evidence. There is no perversity in this finding. Hardly any question of law arises which needs to be determined in the present appeal. We, therefore, dismiss this appeal as being devoid of any merits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods or the Books of Account of the assessee were incorrect. In the opinion of the CIT(A) such an inquiry could have, at best, led to some adjustment in profits but could not have led to complete disallowance of the expenses, payment in respect of which was made to the aforesaid parties. It was on this basis that the case was remanded back to the Assessing Officer with direction to pass fresh order after making full inquiry and hearing the assessee. 4. In the second round the Assessing Officer allowed the expenses claimed in respect of payments made to five out of the aforesaid ten parties. In respect of remaining five parties it was found that three parties could not be served at given addresses but other two parties who had appeared, namely, proprietor of M/s. Bright Enterprises and proprietor of M/s. Shiv Shakti Painting Works, the Assessing Officer did not believe their version and dealt with their cases in the following manner:- Shri Hemant Kumar, Prop. Bright Enterprises attended the office of the undersigned in response to summons under section 131 of the Income-tax Act. He deposed that at present he has no books of account or bill book for verification. But he admitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely, purchase of raw material from the aforesaid five parties on the following basis : (a) All the payments were made to the said parties by the assessee by Account Payee cheques only. (b) Wherever required income-tax at source was also deducted. (c) The payments made to the same parties in subsequent years have been accepted and those payments were allowed as deductions. (d) The assessee had produced the Bank Statement of the said parties which manifest that the cheques issued by the assessee were duly received by those parties in their bank accounts. (e) The bank entries in the bank accounts of the parties produced also show that they were small dealers/job workers and were dealing mainly with the assessee because of which they had issued bills which are in serial numbers. 7. Learned counsel for the appellant submits that the four parties on the given addresses could not be served and from the statements of the proprietors of the two parties who had appeared, it was clear that they did not maintain the Statement of Accounts. Therefore, the Assessing Authority was right in disallowing the expenditure claimed in respect of alleged payments made to those ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yee cheques and these were duly credited in their Bank Accounts. If this is the reason which persuaded the Assessing Authority to allow deletion of the addition made earlier, we fail to understand as to how same reasons would not be applicable in other cases where expenditure was disallowed. 9. As noted above, even the proprietors of M/s. Bright Enterprises and M/s. Shiv Shakti Painting Works had made the statements that they had received the payment by means of Account Payee cheques and they had also specifically affirmed that they had been supplying the goods/raw material to the assessee. The assessee had itself produced the Bank statements of all these parties which successfully demonstrated that payments made by the assessee vide Account payee cheques were duly credited in the Bank accounts of the said suppliers. Insofar as bills which are in serial numbers produced by the suppliers are concerned, the Tribunal has itself indicated that though it may raise some doubt but would not be conclusive to hold that payments for such parties are either bogus or sham. The Tribunal took into consideration some other factors as well and the cumulative effect of all these factors clearly ..... X X X X Extracts X X X X X X X X Extracts X X X X
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