TMI Blog2019 (1) TMI 990X X X X Extracts X X X X X X X X Extracts X X X X ..... to establish their identity before the CIT(Appeals) and although the CIT(Appeals) accepted the factum of machinery expenses incurred by the assessee on the basis of the supporting evidence, he treated the bills issued by the concerned three parties as bogus on the basis of unfounded doubts expressed by the AO and sustained the addition to the extent of profit on estimated basis. Having regard to all the facts of the case as well as the evidence placed on record by the assessee, we are of the view that the ld. CIT(Appeals) ought to have deleted the addition made by the Assessing Officer on account of the alleged bogus machinery expenses when the claim of the assessee for such expenses was duly supported by the relevant and cogent evidence - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the remark not known . When this position was confronted by the Assessing Officer to the assessee, it was submitted by the assessee that he was having regular transactions with the concerned parties for a long period of time. The copies of the ledger account of the said parties were also furnished by the assessee pointing out that the payments to the said parties were made by account payee cheques after deducting tax at source. Copies of trade license/professional tax receipts of the parties were also filed by the assessee. When the Assessing Officer required the personal appearance of five parties for his examination, the assessee produced four out of five parties for verification before the Assessing Officer. Although all these four ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arties, copies of their PAN Cards were filed by the assessee before the ld. CIT(Appeals). After considering this documentary evidence placed on record by the assessee, the ld. CIT(Appeals) proceeded to decide the issue vide paragraph no. 7.1 7.2 at page 9 of his impugned order as under:- 1. I have carefully examined the action of the Ld AO in treating the expenditure on account of purchases as bogus in view of non-identity / non-compliance of the parties Involved, who had were alleged to have transactions with the assessee. After going through the findings of the Ld. AO and the appellant's submissions with Judgments Cited, J am of the considered view that addition of whole amount of purchases made from a party just because that p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he addition of ₹ 6,36,690/- made by the Assessing Officer on account of disallowance of machinery expenses to the extent of ₹ 95,504/- being the profit estimated at 15%. Being aggrieved by the order of ld. CIT(Appeals), the assessee has preferred this appeal before the Tribunal. 4. We have heard the arguments of both the sides and also perused the relevant material available on record. As submitted on behalf of the assessee before the ld. CIT(Appeals) as well as before us, the relevant details of the concerned five parties along with the copies of bills issued by them were duly furnished by the assessee before the Assessing Officer during the course of assessment proceedings in support of his claim for machinery expenses. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... milarly he was not justified in treating the bills issued by the fifth party as bogus merely because of the failure of the assessee to produce the said party before him for verification, especially when the overwhelming evidence was produced by the assessee in the form of relevant bills, payments by cheque, tax deduction at source, etc. to support and substantiate his claim for the corresponding machinery expenses. As a matter of fact, the assessee even filed the copies of PAN Cards of these parties to establish their identity before the ld. CIT(Appeals) and although the ld. CIT(Appeals) accepted the factum of machinery expenses incurred by the assessee on the basis of the supporting evidence, he treated the bills issued by the concerned th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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