9911796707
TMI Blog2014 (11) TMI 1016X X X X Extracts X X X X X X X X Extracts X X X X ..... 80,892/- made by the AO u/s. 69C of the Act by treating the purchases as not genuine. 3. The assessee is a partnership firm carrying out the business of civil contracts, civil infrastructure, such as drainage and road repairs & maintenance mainly with Municipal Corporation of Greater Mumbai. The return for the year was filed on 28.9.2010 declaring total income of Rs. 2,99,79,680/-. The return was selected for scrutiny assessment and statutory notices were accordingly issued and served on the assessee. 3.1. During the course of the assessment proceedings, the Assessing Officer observed that the assessee has shown contract receipts at Rs. 32.05 crores against which total purchases and direct expenses were shown at Rs. 27.5 crores. The deta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sp; TOTAL 49880892/- 3.3. The assessee was asked to showcause why the transactions with these parties should not be considered as non genuine and the whole amount claimed as purchase from these parties should not be disallowed. On receiving no plausible reply to the showcause notice, the AO proceeded by treating the purchases of Rs. 4,98,80,892/- as bogus purchases and added the same to the total income of the assessee. 4. Aggrieved by this, the assessee carried the matter before the Ld. CIT(A). It was strongly contended by the assessee that the execution of the work is executed by the assessee under the directions of the Sub- Engineers of Municipal Corporation of Greater Mumbai. The progress and quantity of work is verified by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ailed to corelate the material purchased with their use in the projects. 5. Aggrieved by this, the assessee is before us. 6. The Ld. Counsel for the assessee reiterated what has been submitted before the lower authorities. It is the say of the Ld. Counsel that all the purchase invoices were submitted before the AO and the AO has not pointed out any defect in the purchase invoice. The Ld. Counsel further stated that the purchases were duly paid by account payee cheque and the payment is reflected in their respective copies of ledger account. The payments are also reflected in the bank statements of the assessee therefore it cannot be said that purchases are bogus. 7. Per contra, the Ld. Departmental Representative strongly supported the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee U/s. 44AD of the Act, the presumptive profit in case of civil contractors is 8% and in case of a partnership firm, a further deduction is allowed in respect of salary and interest paid to the partners. The ratio analysis of the profitability is also in favour of the assessee. In our considered opinion, the purchases are supported by proper invoices duly reflected in the books of account. The payments have been made by account payee cheque which are duly reflected in the bank statement of the assessee. There is no evidence to show that the assessee has received cash book from the suppliers. The additions have been made merely on the report of the Sales tax Department but at the same time it cannot be said that purchases are bogus. We, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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