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TMI Blog2015 (4) TMI 708X X X X Extracts X X X X X X X X Extracts X X X X ..... in para 4.1 of CIT(A)'s order. 2.1 Matter was carried before the First Appellate Authority, wherein various contentions were raised on behalf of assessee and having considered the same CIT(A) has granted relief to the assessee by following CIT(A)'s order for A.Y. 2007-08. Thus deleted the addition. 2.2 Before us, learned Authorized Representative pointed out that Tribunal in A.Y. 2007-08 has decided the similar issue in favour of assessee. We find that Tribunal in A.Y. 2007-08 has upheld the order of CIT(A) who has granted relief to assessee by observing as under: "7. We find that the Assessing Officer made an addition of Rs. 58,69,299/- on account of bogus purchases of grey clothes as he found that the bills of M/s M M Traders, K N Traders, New Kamal Textile, Arbuda Traders, Navjivan Textile etc. had incomplete address, were prepared by one person and also signed by the same person in all the cases and that the credits in the bank statement of the suppliers was of the cheques paid by the assessee which were immediately withdrawn by them on the very same day. On these facts, the Assessing Officer held that the entire purchases of Rs. 58,69,299/- as bogus. 8. On appeal, the CIT( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The appellant has also shown the sales of grey cloth of Rs. 12,50,310 during the year under consideration which is shown in Schedule-M of audited accounts. The above information was submitted to the A.O. also during assessment proceedings. He therefore, strongly objected that the sale and closing stock of grey cloth of Rs. 2926024/- (1250310 + 1675714) already shown in the credit/income side of the audited P & L A/cs for the F.Y. 2006-07 has been wrongly added by the A.O in the income of the appellant. 3.3.3. The Ld. A.R. further submitted that the appellant has consumed net grey cloth of Rs. 29,43,275 as packing material for affecting export sale of Rs. 181.57 Crs. The grey cloth consumed in F.Y. 2006-07 is merely 0.16% of total export sales which is very reasonable and justifiable as compared to the turnover made during the year under consideration. The Ld. A.R. also submitted that the appellant provided all the bills of grey cloth purchased during the year under consideration during assessment proceedings. The A.O. asked to produce grey cloth parties before him and in compliance to the same, the appellant has produced 3 parties i.e Proprietor of Sambhav Textiles, M.M. Traders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lead the conclusion that the said purchases are bogus. The assessee has discharged its onus by submitting the required details to the A.O. Therefore, the burden is shifted upon the A.O. to prove that the purchase price has been return back by the said party to the appellant. The observation regarding the immediate cash withdrawal is only regarding one of the supplier i.e. M/s M M Traders. It is a fact on record that there are many other suppliers from whom such purchases have been made. The appellant produced 3 grey suppliers before the A.O. for verification but the A.O. has neither examined them nor recorded their statements. The appellant also supplied the quantitative telly of the impugned grey cloth. 3.3.7 I have carefully gone through all the details available on record, copy of purchase bills of the grey cloth, copies of the contra a/cs in the books of the suppliers as well as in the books of the appellant and the a/c payee cheque payment made by the assessee company to the said suppliers. As stated in earlier paras, the appellant has supplied the complete telly of grey cloth in terms of purchases, sales, closing stock as well as its consumption as packing material. The cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 No.1563/Ahd/2002 dated 3.11.2006 held as under::- The assessee went in appeal before the CIT(A) who deleted the addition by observing as under:- "I have carefully considered the submission of the appellant and the documents furnished by him. I have also gone through the various judicial pronouncement referred to above. The mere fact that the appellant has not been able to produce the parties for verification cannot lead to the presumption that the purchases were bogus. Copies of the bills filed by the appellant shown that the material purchased was dully sold and if the purchases are held to be bogus then corresponding amount of sales will have to be reduced from the total sales, since the purchases cannot simply vanish in thin air. Further , the assessing officer has not brought any material on record to prove that the moneys withdrawn by the parties from their bank account with Shri Laxmi Coperative Bank flowed back to the appellant. It is also important to note that the appellant did not introduce this party for opening accounts with the bank. Apparently no worthwhile inquiry was conducted by the A.O to establish the identity of persons who withdrew the cash, which could hav ..... X X X X Extracts X X X X X X X X Extracts X X X X
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