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TMI Blog2011 (11) TMI 733X X X X Extracts X X X X X X X X Extracts X X X X ..... Rajnish Deo Burman For the Respondent: Shri Bhupendra Shah ORDER PER I.P.BANSAL, J.M, These are cross appeals directed against the order passed by Ld. CIT(A) 10, dated 21/12/2010 for A.Y 2007-08. The grounds of appeal in both the appeals read as under: Assessee s Grounds of Appeal: 1. Under the facts and the circumstances of the case of your Appellant, the Ld. AO has erred in making the addition of ₹ 16,16,613/- as Unexplained/uproved purchases / investment in purchases as per section 69 of the I.t. Act, 1961 which the Ld. CIT(A) scaled down by ₹ 12,46,534/- thereby confirming to the extent of ₹ 3,72,079/-. 2. The appellant, therefore, prays that the addition made by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls in order to inflate/accommodate their purchases made outside books of account. Therefore, AO observed that the concerns of Shri Rakesh Kumar Gupta have admitted hawala sales and his statement on oath was recorded by the department according to which no genuine business activity was being carried out, therefore, the purchases made by the assessee from those concerns were bogus purchases. He asked the assessee to explain as to why purchases made from aforementioned concerns should not be treated as bogus. In response the assessee filed a letter dated 23/12/2009 in which it was submitted that all the purchases made by the assessee from the said parties are real, genuine and physically effected. It was submitted that the assessee has no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmissions were made and it was submitted that addition could not be made simply on the general statement which does not specify the name of the assessee. The purchases made by the assessee are real and genuine for which the payments have been made through banking channels. The seller of the goods have also confirmed and had retracted the statement given during the survey.. Thus it was pleaded that the addition should be deleted. Ld. CIT(A) after considering all these submissions held that entire purchases cannot be added back as unexplained because the assessee has already shown the sale proceeds against alleged purchases and in such cases if any addition is to be made then it is only on account of G.P rate or some adhoc addition. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re evidence was placed on record which clearly evidences the genuineness of the purchases made by the assessee. He submitted that in the statement recorded by the revenue, the name of the assessee did not specifically exist. The addition was made by the AO on presumption that the entire sales made by those concerns were not genuine. He submitted that Shri Rakesh Kumar Gupta has furnished letter in response to notice of the AO in which it has been clearly stated that the earlier statement has been retracted and the sales made by those concern to the assessee are genuine for which goods have been delivered and payments have been received through banking channels. Thus it was submitted by him that addition should be deleted in its entiret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t I have sold the goods to M/s. Jitendra Harshad Kumar Textiles P. Ltd. and the consideration is received to me by cross order cheque. Copy of the said ledger account is already submitted the department. 8.1 From the above letter it is clear that the same was written in response to notice issued by the AO. Not only Shri Rakesh Kumar Gupta has stated that he has retracted from the statement recorded during the survey but also filed an affidavit dated 20/2/2009 and letter dated 27/4/2009 to deny the statement made during the survey under section 133A. He has further confirmed that the sales made by the assessee were effected and the consideration was received by cross order cheques. Thus it is clear that there is no material on record ..... X X X X Extracts X X X X X X X X Extracts X X X X
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