TMI Blog2023 (6) TMI 215X X X X Extracts X X X X X X X X Extracts X X X X ..... eduction of TDS cannot be a ground for treating the purchases as non-genuine. Similarly in the case of Sirazuddin Gitti Supplier the addition was sustained by the ld. CIT (Appeals) for the reason that the assessee has not mentioned any TIN, did not file copy of ITR, PAN, confirmation ignoring the copy of bank statement, copy of ledger account in the books of assessee company, copy of invoices, purchase orders. The vendor here had supplied stone dust, a construction material with weigh bridge challans and invoices. Thus there is no justification in sustaining the additions by the ld. CIT (Appeals) in respect of purchases/expenses from the above parties. Thus, we direct the Assessing Officer to delete the addition/disallowance - Decided in favour of assessee. Addition made on the alleged entries in the seized material - assessee has not explained the entries with regular books of accounts and also could not provide the identity of the parties - HELD THAT:- To find out whether the entries appearing in the diary reflects either the assessee has received the payments or made the payments. AO did not bring any material or evidence to corroborate that these expenses were incurr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Ground Nos. 3 5, 4 5 and 4 5 of the appeal for assessment years 2009-10, 2010-11 and 2011-12 are directed against sustaining the addition of Rs. 1,80,815/-, 2,45,908/- and Rs. 35,809/- respectively on account of purchases made by the assessee. 4.1 Briefly stated the facts are that in the course of assessment proceedings the Assessing Officer noticed that the assessee has claimed expenses on account of purchases related to infra projects. Assessee was required to establish identity, creditworthiness of the vendors. Notices were also issued under section 133(6) of the Act to vendors by the Assessing Officer. Some of the vendors have also responded to the notices issued under section 133(6) of the Act by the Assessing Officer. Since the assessee has not produced the parties for verification and did not file confirmation copy of ledger account from the vendors the Assessing Officer disallowed purchases from certain vendors as mentioned in the assessment order and made addition of Rs. 45,58,538/-, Rs. 36,11,273/- and Rs. 55,32,299/- for the assessment years 2009-10, 2010-11 and 2011-12 respectively. 4.2 On appeal the ld. CIT (Appeals) considering the submissions and evid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annot be brushed aside while treating the purchases as non-genuine. The reason for treating the purchases as non-genuine is the assessee has not produced PAN number, no address proof, no counter-signed ledger account. The assessee in fact filed copy of TIN of the supplier to prove the identity and existence of business concern. Therefore, in our view simply because the assessee has not filed PAN, copy of ITR, these purchases cannot be treated as non-genuine. 7. In the case of Shri Kalyan Singh the only ground on which the addition was sustained by the ld. CIT (Appeals) was that the assessee has not deducted the TDS, even though the assessee has furnished copy of ledger account in the books of the assessee company, copy of vouchers and bank statements, copy of ledger for the financial year 2010-11, copy of vouchers and ledger details in respect of the work done by the vendors. Non-deduction of TDS cannot be a ground for treating the purchases as non-genuine. 8. Similarly in the case of Sirazuddin Gitti Supplier the addition was sustained by the ld. CIT (Appeals) for the reason that the assessee has not mentioned any TIN, did not file copy of ITR, PAN, confirmation ignoring the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the noting are requests related to payments on phone to be made to vendors/ suppliers against work done on sites/projects of the assessee and group company and has no closing or opening balances. However the assessee has tried to co-relate, to the extent possible, the entries in respect of which explanation has been sought with the statutory books of accounts maintained by the assessee. 10.3 However, the Assessing Officer treated Rs. 9,00,000/- in respect of three entries (Rs.1,00,000/-, Rs. 5,00,000/- and Rs. 3,00,000/-) made in the loose sheets/diary observing that the assessee has not explained the entries with regular books of accounts and also could not prove the identity of the parties and there was no satisfactory explanation of the amount written in the diaries and loose papers. Similarly for the assessment year 2011-12 the Assessing Officer made addition of Rs. 1,08,000/- in respect of two entries consisting of Rs. 50,000/- and Rs. 58,000/-. 10.4 On appeal the ld. CIT (Appeals) in so far as assessment year 2010-11 is concerned restricted the addition to Rs. 8,00,000/- out of Rs. 9,00,000/- and for the assessment year 2011-12 he sustained the entire addition of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) Samta Khinda Vs. ACIT 294 ITR 49 (SC) (x) CIT Vs. P.V. Kalyansundaram (in ITA Nos. 336/Del/2012 5515/Del/2013 dated 29.11.2016) 12. The ld. Counsel further placing reliance on the following decisions submits that if the Assessing Officer disbelieved explanation of the assessee he ought to have issued summons to the payees and in the absence thereof no adverse inference could have been drawn against the assessee:- (a) CIT Vs. Genesis Commet (P) Ltd. 163 Taxman 482 (Del) (b) CIT Vs. V. B. Aggarwal 296 ITR 750 (Del) (c) EMC Works (P) Ltd Vs. ITO 49 ITR 650 (All) (d) Nathu Ram Premchand Vs. CIT 49 ITR 561 (All) (e) CIT Vs. Orissa Corporation (P) Ltd. 159 ITR 78 (SC) (f) CIT Vs. Divine Leasing and Finance Ltd. 299 ITR 268 (Del). 13. On the other hand, the ld. DR submits that in the loose papers and the diary seized the names are mentioned, dates are mentioned, amounts are mentioned and, therefore, it is not a dumb document. The ld. DR submits that the addition was rightly made by the Assessing Officer based on the seized materials. 14. Heard rival submissions perused the orders of the authorities below. On perusal of the assessment order we find that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly entry reflected as cash. The Assessing Officer had not made of any sort of enquiry or any investigation carried out by the Assessing Officer post search nor in the remand proceeding. To find out whether the entries appearing in the diary reflects either the assessee has received the payments or made the payments. The Assessing Officer did not bring any material or evidence to corroborate that these expenses were incurred by the assessee. The Assessing Officer has not made any effort whatsoever to make any investigation even though names of persons clearly mentioned in the entries made in the loose sheets. There was no statement recorded from the assessee during the course of search vis- -vis the impugned seized material. We observe that the Assessing Officer simply added the amounts appearing in the diary as unexplained income of the assessee. The Assessing Officer also did not verify the contention of the assessee that these loose sheets did not pertain to the assessee or it is rough work for the site purposes. Therefore, since the Assessing Officer has not made any efforts to make any sort of enquiries or investigation on the entries made, we are of the view that this issue ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2006-07 and 2007-08 where in the Tribunal held as under:- 8. We have carefully considered the orders of the authorities below. Basis of the addition can be understood from the following chart:- Financial Year Declared cost of construction/investment in rupees Financial year- wise estimated cost of construction/investment in rupees Difference 2005-06 33,67,020 35,33,459 1,66,439 2006-07 7,60,95,749 7,98,57,327 37,61,578 2007-08 6,15,69,647 6,46,13,169 30,43,522 2008-09 12,47,29,721 13,08,95,383 61,65,662 2009-10 24,89,75,708 26,12,83,119 1,23,07,411 2010-11 12,09,71,650 12,69,51,543 59,79,893 Total 63,57,09,495 66,71,34,000 3,14,24,505 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the appeals for the assessment years 2010-11 and 2011-12 in the case of the assessee Brahamputra Infrastructure Ltd. in ITA. Nos. 4121 and 4123/Del/2018 and the facts are identical. Therefore, the decision taken therein applies mutatis mutandis to the appeals for the assessment years 2008-09 to 2011-12. We order accordingly. 23. The last common ground in the appeals of the assessee for the assessment years 2009-10 to 2011-12 is in respect of disallowance of expenses/purchases made by the Assessing Officer and restricted by the ld. CIT (Appeals) to Rs. 63,125/-, Rs. 3,68,236/- and Rs. 8,438/- for these assessment years respectively. The Revenue in its appeal in ITA. No. 5123/Del/2018 is in appeal against the deletion of the addition of Rs. 98,09,358/- only for the assessment year 2010-11. 24. This issue is identical to the issue decided in the preceding paras in respect of appeals in ITA. Nos. 4119, 4121 and 4123/Del/2018 and we have already deleted the addition sustained by the ld. CIT (Appeals). Since the facts are almost identical for the reasons therein, we delete the addition sustained by the ld. CIT (Appeals) in respect of purchases/expenses made by the Assessing Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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