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TMI Blog2016 (4) TMI 1057X X X X Extracts X X X X X X X X Extracts X X X X ..... on 26.7.2013. The Ld. CIT(A) after considering the details submitted by the assessee, he gave a categorical finding that no discrepancy has been found in the purchases made by the assessee and for want of confirmations, adhoc disallowance cannot be made. We find that the assessee has submitted all the details before the A.O. even before the Ld. CIT(A). Only on account of non-filing of the confirmations from the farmers who sold the paddy to the assessee, adhoc disallowance cannot be made. In view of the above, we find no reason to interfere with the order passed by Ld. CIT(A). - Decided against revenue. - I.T.A.No.618/Vizag/2013, C.O. No.136/Vizag/2013 - - - Dated:- 18-3-2016 - SHRI V. DURGA RAO, JUDICIAL MEMBER AND SHRI G. MANJUNATHA, A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the assessee. Assessee carried matter in appeal before the CIT(A). Detailed submissions were made before the CIT(A). The relevant portion of the written submission made by the assessee is as under: The appellant being a rice mill, purchases paddy from farmers and converts the same into Rice. It is the custom and practice of this business that the farmers sell paddy on credit at the time of harvest and later the miller repays the amount within a period of 2 to 3 months. January and February being the months of harvesting, huge amount of paddy is purchased in these months and the repayment of this amount takes place to a major extent in the months of April to June. Therefore, it is very common for any rice mill to carry huge stocks of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atutory registers maintained i.e. B Register. 2. The total value of purchases is cross verifiable with the VAT returns and the assessing officer did not notice any discrepancies between the VAT returns and the books of account. 3. Further, the appellant incurred Cess levied by Agricultural Market Committee in respect of all its purchases. 4. All the credits emanating in the accounts of the paddy creditors are on account of journal entries and no cash element is involved. When the debit part of this entry i.e. the purchase amount is cross verifiable, the credit part of the entry being the amount credited to the farmer is automatically explained. 5. It is also not the case of the assessing officer that these amounts ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the village is mentioned in the waybill and also invoice. It was further contended that merely because confirmation letters could not be produced, because of the transaction with farmers, the credit transaction cannot be doubted, particularly when no disallowance was made in respect of purchases and no doubt was raised on the payments of these credits made in subsequent year. The AR was asked to produce the documents maintained for purchasers and corresponding credits in respect of few specific transactions, which were produced during the year on 26.07.2013. I have gone through the details filed and submission made. I find from the order of the AO that he has not found any discrepancy in the purchasers. For want of confirmation letters ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gave a categorical finding that no discrepancy has been found in the purchases made by the assessee and for want of confirmations, adhoc disallowance cannot be made. We find that the assessee has submitted all the details before the A.O. even before the Ld. CIT(A). Only on account of non-filing of the confirmations from the farmers who sold the paddy to the assessee, adhoc disallowance cannot be made. In view of the above, we find no reason to interfere with the order passed by Ld. CIT(A). Thus, the appeal filed by the revenue is dismissed. 7. The C.O. filed by the assessee is supporting the order of the CIT(A). Therefore, for the reasons recorded in the preceding paragraphs, we are of the opinion that the C.O. filed by the assessee is i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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