TMI Blog2017 (11) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... nning into 472 pages. The assessee has not filed any certificate with the paper book that these documents have been filed before the A.O and / or learned CIT(A) and from the careful perusal of these document filed in paper book before us , we could not find that the assessee has co-related purchases with the sales and utilisation/ consumption of the material was proved by the assessee before the authorities below. No, doubt large number of documents are filed before us running into 472 pages in paper book filed in two volumes. These documents need verification and authentication by the authorities below . Thus, keeping in view interest of justice and fair play it is deemed fit and appropriate that the matter need to be set aside and restored to the file of the A.O for fresh determination of the issue on merits de-novo in accordance with law as we are of the considered view that the assessee so far could not prove utilisation / consumption of material and genuineness of the purchases but since large number of evidences are filed before us , the same required verification/authentication by authorities below. Appeal of the assessee allowed for statistical purposes. - I.T.A. No.50 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Newspark Trading P. Ltd, P.K Trading Company, Ruby Impex, Mark Enterprises, Universal Supplier, Paras Enterprises and Nidhi Industries had allegedly supplied Ply, Fevicol railing etc. to the assessee , wherein there is an allegation of the Revenue that no material was supplied by these parties and only bogus bills were issued without supplying any material to the assessee . The assessee filed copies of invoices , ledger and bank statements regarding purchases from these parties before the AO and it was contended that the purchase transactions were genuine. It is contended by the assessee that the assessee is a work contractor for furnishing and fixture, civil and electrical fittings and related jobs and that material required at every site is ordered as per requirements . The work orders are raised in favour of suppliers who deliver the material at site which is checked by supervisor or person in charge. It is contended that material so supplied has been used at the site and duly charged to the customer which proves consumption of material for the business of the assessee and against which sales bills were duly raised. It was submitted that the parties from whom material was purcha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was also submitted the material was consumed for the purposes of use at site for the work contract undertaken by the assessee and it was billed to the customers. The assessee submitted that additions cannot be made without affording cross examination of the persons who have given incriminating statement against the assessee. It was submitted that merely because these dealers are placed in list of hawala dealers as they have defaulted in payment of VAT , no additions can be made in the hands of the assessee. It was held that the AO erred in ignoring the books of accounts of the assessee. It was submitted that sales are not in dispute. It was submitted that the assessee has shown GP ratio of 17.05% and NP ratio of 9.5% which is reasonably good . The learned CIT(A) restricted the addition to 25% of alleged bogus purchases by relying on CIT v. Simit P Sheth in ITA no. 553 of 2012 , order dated 16-01-2013 passed by Hon‟ble Gujarat High Court , and also decision of ITAT in Vijay Proteins Private Limited v. CIT reported in 58 ITD 428, as the purchases were unverifiable as to the parties from it was made as the parties were not traceable. The learned CIT(A) observed that either purc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owing parties namely N.B. Enterprises, Kamlesh Trading Companies, Newspark Trading P. Ltd, P.K Trading Company, Ruby Impex, Mark Enterprises, Universal Supplier, Paras Enterprises and Nidhi Industries had allegedly supplied Ply, Fevicol railing etc. to the assessee wherein there is an allegation of the Revenue that no material was supplied by these parties and only bogus bills were issued without supplying any material to the assessee . The assessee filed copies of invoices , ledger and bank statements regarding purchases from these parties before the AO and it was contended before the AO that the purchase transactions were genuine. It is contended by the assessee before the AO that the assessee is a work contractor for furnishing and fixture, civil and electrical fittings and related jobs and that material required at every site is ordered as per requirements . The work orders are raised in favour of suppliers who deliver the material at site which is checked by supervisor or person in charge. It is contended by the assessee that material so supplied has been used at the site and duly charged to the customer which proves consumption of material for the business of the assessee and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with corresponding sales . It was also submitted before learned CIT(A) that the material was consumed for the purposes of use at site for the work contract undertaken by the assessee and it was billed to the customers. The assessee submitted that additions cannot be made without affording cross examination of the persons who have given incriminating statement against the assessee. It was submitted that merely because these dealers are placed in list of hawala dealers as they have defaulted in payment of VAT , no additions can be made in the hands of the assessee. It was submitted that the AO erred in ignoring the books of accounts of the assessee. It was submitted that sales are not in dispute. It was submitted before learned CIT(A) that the assessee has shown GP ratio of 17.05% and NP ratio of 9.5% which is reasonably good . The learned CIT(A) restricted the addition to 25% of alleged bogus purchases by relying on CIT v. Simit P Sheth in ITA no. 553 of 2012 , order dated 16-01-2013 passed by Hon‟ble Gujarat High Court and also decision of ITAT in Vijay Proteins Private Limited v. CIT reported in 58 ITD 428, as the purchases were unverifiable as to the parties from it was ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee has claimed these expenses and the onus is on the assessee to prove the genuineness of the said expenses for purchases of material , thus with these direction matter is set aside and restored to be file of the A.O. for fresh determination of the issue on merits in accordance with law. At this stage , we are reminded of the recent decision of Hon‟ble Supreme Court in the case of N. K. Proteins Ltd. v. DCIT (2017-TIOL-23-SC-IT). Needless to say that the A.O shall provide proper and adequate opportunity of being heard to the assessee in accordance with principles of natural justice in accordance with law.The AO shall admit evidences/ explanations filed by the assessee in its defence in denovo proceedings. We order accordingly. 7. Thus, in the result appeal of the assessee in ITA no. 5084/Mum/2016 for AY 2009-10 is allowed for statistical purposes. 8. Our decision in ITA 5084/M/2016 for assessment year 2009-10 shall apply mutatis mutandis to the appeal of the assessee in ITA no. 5085/M/2016 and 5086/M/16 for AY 2010-11 and 2011-12. These two appeals are also allowed for statistical purposes. We order accordingly. 9. Thus, in the result all the appeals of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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