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TMI Blog2021 (5) TMI 786X X X X Extracts X X X X X X X X Extracts X X X X ..... ing officer 's order be restored." 2. Brief facts of the case as gathered form the orders of the lower authorities are that the assessee is proprietor of M/s Balaji Corporation and engaged in the business of rough and polished diamonds. The assessee filed his return of income for assessment year 2005-06 on 31.10.2005 declaring total income of Rs. 1,05,248/-. The case was selected for scrutiny and assessment was completed under section 143(3) on 28.11.2007, assessing total income of Rs. 1,90,260/-. The case was again reopened under section 147. Notice under section 148 was issued to the assessee on 23.04.2010. The assessee vide his application dated 11.05.2010, requested for reasons recorded. The reasons recorded were supplied to the assessee on 26.05.2010. The assessee vide his application dated 15.12.2011, stated that return of income filed on 31.10.2005 may be treated as return of income in response to the notice under section 148. The assessing officer after serving statutory notices under section 142(1) and 143(2) completed the assessment under section 143(3) read with section 147 on 29.12.2011. The assessing officer while passing the assessment order besides the other addit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urchases. The ld. DR for the revenue submits that during the reassessment proceedings the assessing officer noted that the assessee has shown purchases from three parties namely Sagun Impex of Rs. 29.36 Crore, Nakoda Gems of Rs. 1.27 Crore and Sunrise Impex of Rs. 99.67 Lacs, total of Rs. 31.64 Crore. In order to verify the genuineness of the expenses of purchases, the assessing officer sent notices to all the three parties under section 133(6). The notices sent to all three parties could not be served. Postal authorities and the Inspector reported that none of the parties exist at the given address. The assessee was asked to produce the parties with their books of account and the bank statement for verification. The assessee failed to produce the parties or their confirmation, therefore, the assessing officer made disallowance @ 25% of total purchases by following the order of Tribunal in Vijay Proteins Vs CIT (55 TTJ 76). The assessing officer worked out the disallowance of Rs. 7.91 Crore. The Ld. CIT(A) deleted the entire additions by accepting the submissions of the assessee that after eight years of gap the additions cannot be made merely for non-production of the parties. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned after four year from the end of assessment year. The assessee has disclosed all information while filing return of income, no new information or tangible material came to the notice to the assessing officer and / or there was no reference in the reasons for reopening that any new tangible material came to the notice of the assessing officer or the assessee has not disclosed all information fully and truly at the time of filing the return of income. The reopening is clearly based on the change of opinion. To support his submissions he relied on the decisions of Gujarat High Court in P.C Patel & Co (379 ITR 151 Guj) and Arvind Mills ( 270 ITR 469 Guj) and decisions of Tribunal in ITO Vs Smt Gurinder Kaur ( 2006) ITD 189/105 TTJ 198 and ACIT Vs Raj Kumar Jain [IT(SS) A No. 28/Del/2012] dated 08.07.2015. 9. In rejoinder submissions the Ld. CIT-DR for the revenue submits that the assessee never raised objections against the reopening during the reassessment before the assessing officer. The assessee was served with the notice under section 148 on 11.05.2010. No compliance was made by the assessee to the notice under section 148 within 30 days. The assessee filed his letter on 15.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s merely on the ground that the assesse failed to produce the parties for verification by relying on the decision of Vijay Proteins (supra). The assessee filed the copy of bank statement of the parties. The assessing officer has not investigated if the amount paid by the assessee was recycled back to the assessee. 12. The ld AR for the assessee has relied on the decision of Hon'ble Jurisdictional High Court in PCIT Vs Tejua Rohit Kumar Kapadia (supra), wherein the appeal of revenue was dismissed by High Court. In the said appeal, the revenue assailed the order of Tribunal on deleting the partial disallowances of the purchases. The Hon'ble High Court held that when the assessee is trader and have shown the sales out of the purchases, which have been accepted by revenue and there was no evidence to show that the amount was recycled back to the assessee. Therefore, considering the decision of High Court of similar set of facts, we do not find any merit in the grounds of appeal raised by the revenue. No contrary fact or law is brought to our notice to take other view. Hence, we affirms the order passed by ld. CIT(A). In the result this ground of appeal raised by the revenue is re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The ld CIT(A) appreciated the submissions of assessee and deleted the addition. Hence, the ld AR for the assessee supported the order of ld CIT(A). 16. We have considered the submissions of both the parties and have perused the record carefully. The assessing officer made additions by holding that there was difference of closing balance of one of the party namely Frost International Ltd of Rs. 8.05 Crore. The assessing officer also rejected the books of accounts before making such addition. No specific reason for rejecting the books of account was recorded by the assessing officer. The ld. CIT(A) deleted the additions by taking view that the assessee filed confirmation of Ratan Export during the assessment. The assessing officer has not made investigation at Surat addresses, if he has any doubt regarding the existence of the party; the assessing officer ought to have made further investigation. It was further held that after knowing the fact that the party was having the same PAN, the assessing officer could have reconfirmed about the party. 17. We have further noted that despite filing the confirmation of Ratan Export the assessing officer has not referred the same in his order ..... 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