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TMI Blog2021 (9) TMI 765X X X X Extracts X X X X X X X X Extracts X X X X ..... order of Ld. CIT(A) enhancing the addition of Rs. 15,373/- made by the AO to Rs. 1,22,985/- which is 100% of bogus purchases. 4. The facts in brief are that the assessee filed the return of income on 30.09.2011 declaring a total income of Rs. 13,21,493/- which was processed under section 143(1) of the Act. The case of the assessee was thereafter reopened by the AO after receipt of information from DGIT (Inv.), Mumbai that assessee is beneficiary of hawala purchase entries to the extent of Rs. 1,22,985/- and accordingly the notice under section 148 of the Act was issued on 17.06.2014. The AO called for various details and information from the assessee from time to time during the course of assessment proceedings which were duly filed befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment order. 7. Accordingly, ground No.2 is allowed. 8. The issue raised in ground No.3 is against the confirmation of addition of Rs. 4,14,421/- by Ld. CIT(A) as made by the AO by invoking the provisions of section 40A(3) of the Act. 9. The facts in brief are that the AO on the basis of examination of books of accounts observed that assessee has made various cash payments exceeding Rs. 20,000/- to various parties and accordingly a show cause notice dated 02.03.2016 was issued to the assessee as to why the payment exceeding the limit as specified under section 40A(3) of the Act should not be disallowed which was replied by the assessee by submitting that the payments in most of the cases were below Rs. 20,000/- and where the payments ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons were established whereas in the present case the assessee has failed to establish the identities of both the agent as well as suppliers. 11. After hearing both the parties and perusing the material on record, we find that assessee is engaged in the business of water proofing and labour job work. It was submitted before us that sand is purchased by the assessee from agent who arranged the loaded truck of sand at the site of the assessee on the condition that payment would be accepted in cash only. These transporters are not having any fixed place of business but bring sand filled lorries and come to the site through some reference. These truck drivers are not having any PAN numbers and therefore we find merit in the contention of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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