TMI Blog2017 (9) TMI 1097X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Act and moreover no opportunity to confront or cross-examine the parties which were declared as hawala dealers by the Sales Tax Authorities was provided to the assessee. Merely because the assessee could not produce the stock records in the required form in 3CD do not prove that the purchases were not genuine. Under the above circumstances, we are of the considered view that non-producing of the supplier or stock register by the assessee is not the ground to declare the expenses /purchases as ‘unexplained expenditure’. Considering that the assessee had already supplied corroborative documents like copy of invoices, name and address of suppliers and details of bank transactions, we are of the considered view that the entire ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unts are audited as per S. 44AB of the IT Act, 1961 and the AO and / or the CIT(A) have not rejected the books of accounts for the said AY. b. The appellant had provided full and complete explanation for the source of funds for incurring such expenditure (the same being from receipts/ income from the same business concern), and as such there has been no case of Unexplained Expenditure' as contemplated by the AO and/ or the CIT(A), as provided u/s 69C, under which the alleged addition to the returned income has been made. 1.3 Without prejudice to the above, the appellant would like to state that: a. If at all, the alleged 'Bogus Purchases of ₹ 44,44,022/-' is to be considered, only the 'Gross Profit' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raised by the assessee are inter related and inter connected and relates to challenging the order of Ld. CIT(A) in confirming the addition/disallowance on account of bogus purchases u/s 69C for unexplained expenses , therefore we thought it fit to dispose of the same through this common order. 4. We have heard the counsels for both the parties and we have also perused the material placed on record as well as the orders passed by revenue authorities. As per the facts of the case the assessee is a HUF and it has declared itself to be the proprietor of M/s Anuradha Insulation which is engaged in the business of labour contrarctor for insulation works. After the assessment u/s 143(1) of the I.T. Act, the AO received information from the Di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion can be made as it only goes to the expenses of the assessee. Lastly the argument of the assessee that it did not get the chance to cross examine the hawala sellers is baseless. The assessee had filed its return and claimed the impugned dealers are its jers. The assessee avers that its accounts are true and correct. The 'dealers' are thus the of the assessee through whom the assessee seeks to justify its books of account. When the assessee's witnesses do not back the assessee's claims, it cannot be said that the AO has enterained the witness of an outside third party. The A.O. had merely verified the claim of the assesee and found it to be untrue The onus remains on the assessee to substantiate his return of income. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orders passed by Ld. CIT(A) and hearing the counsels at length, we find that as per the facts of the present case, the AO made additions on the purchases made from the parties (details of which are given in para no. 5.1 of the order of AO) by holding that the assessee has failed to prove the genuineness of the transactions. Now before us Ld. AR appearing on behalf of the assessee submitted that the recorded purchases are genuine and are supported with documents ie. Copy of invoices, names and addresses of suppliers and details of the payment to the parties. It was further argued that all the payments have been made by the assessee through banking channel and assessee had also furnished all details and it was further submitted that the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rial from the parties. We have noticed that the AO has not issued notice u/s 133(6) of the I.T. Act to the bank of the assessee or of the suppliers to verify whether immediate cash had been withdrawn against the payments made by the assessee. We have further noticed that the AO has not rejected the assessee s books of accounts u/s 145(3) of the Act and moreover no opportunity to confront or cross-examine the parties which were declared as hawala dealers by the Sales Tax Authorities was provided to the assessee. Merely because the assessee could not produce the stock records in the required form in 3CD do not prove that the purchases were not genuine. Under the above circumstances, we are of the considered view that non-producing of the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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