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TMI Blog2017 (10) TMI 928X X X X Extracts X X X X X X X X Extracts X X X X ..... , therefore, requested that the Assessing Officer may be directed to delete the estimated addition made on account of doubtful purchases. 3. On the facts and in the circumstances of the case and in law, the learned CIT(A) was no t jus t i f ied in law f o r no t de l e t ing the e n t i r e e s t ima t ed add i t i o n mad e by the assessing off icer even when the appellant was not provided the copy of the statements and opportunity to cross examine the parties on the basis of whose the statements the purchases made f rom those parties were treated accommodation entry. The addition therefore cannot be sustained. 4. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in coming to the conclusion that the investigation Wing of the income tax Department had already established the parties as hawala dealers. The addition made by the assessing officer and partially confirmed by the learned CIT (A) is illegal as the assessing officer has to take his own decision rather than following the decision of investigation Wing. 5. On the facts and in the circumstances of the case and in law, the learned CIT (A) erred in confirming the view taken by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in law, the learned CIT (A) erred in not deleting the entire addition made by the assessing officer even when the sales have been accepted and various evidences were produced in respect of the purchases made especially the fact that payments were made through banking channels. 12. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in comparing GP of the comparables with different parameters than the ones used for calculating GP of the appellant, whereas the GP of the Appellant is more than the GP of the comparables if the same parameters are applied as that of the comparables selected by the A.O. It is prayed that the entire addition of Rs. 41, 37, 804/- may kindly be deleted. The appellant craved leave to add, alter or amend any of the aforementioned ground or grounds of appeal, which are without prejudice to each other, as and when an occasion may arise at the time of hearing. 2. Briefly stated, the facts of the case are that the assessee is engaged in the business of manufacturing of plain gold jewellery and other related products. The return of income was filed by the assessee on 28.09.2012, declaring total income of Rs. 17,61 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the significance of the certificates which were furnished by the assessee in order to support the genuineness of the purchase transactions. It was observed by the A.O that the assessee had during the course of the assessment proceedings also expressed its inability to produce the aforementioned supplier parties from whom purchases were claimed to have been made, for examination before the A.O. That it was further observed by the A.O that the assessee not only failed to place on record the confirmations from the aforesaid respective supplier parties, but rather, even failed to furnish their present addresses and whereabouts. Thus, the A.O after deliberating on the aforesaid facts, therein concluded that the assessee apart from stressing that the payments to the respective supplier parties were made vide account payee cheques, however, failed to substantiate the genuineness of the purchase transactions. It was further observed by the A.O that the aforesaid claim of the assessee that the payments to the aforementioned parties were made vide account payee cheques also did not inspire much of confidence, as in the absence of the copies of the bank accounts of the aforementioned parties, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsactions made by the assessee from the aforementioned concerns and had wrongly drawn adverse inferences in respect of the same. The ld. A.R in support of his aforesaid contention that no addition was called for in the hands of the assessee, therein relied on the order of a coordinate bench of the ITAT 'F', Mumbai in the case of Indo Unique trading, Pvt. Ltd., Mumbai Vs. DCIT-5(2)(1), Mumbai (ITA No. 6341/Mum/2016, dated 16.08.2017). It was submitted by the ld. A.R. that the Tribunal in the aforementioned case had held that where the A.O had simply relied on the report given by the investigation wing, then no addition made on the said count in respect of the bogus purchase could be sustained in the hands of the assessee. It was further averred by the ld. A.R that the A.O without rejecting the books of account of the assessee had wrongly made the addition in the hands of the assessee by alleging the purchase transactions to be bogus. Per contra, the ld. Departmental Representative (for short 'D.R') relied on the order of the CIT(A). 6. We have heard the authorized representatives for both the parties, perused the orders of the lower authorities and the material available on record. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the trail of the money deposited therein also could not be verified by the A.O. We are of the considered view that the A.O in the present case had not merely made additions in the hands of the assessee on the basis of the information received from the investigation wing of the department, but rather had so done after conclusively proving that the assessee had failed to substantiate the genuineness and veracity of the purchase transactions during the course of the assessment proceedings. We further find that the A.O had adopted very well reasoned approach, and after benchmarking the gross profits margins of the assessee in the backdrop of the turnover parameter of certain other concerns, had therein fairly estimated the gross profit margin in the hands of the assessee at 17%. We find that the CIT(A) adopting a liberal approach had further allowed a relief of 1% to the assessee on the issue of payment of VAT. We find ourselves to be in agreement with the view arrived at by the CIT(A), and find no reason to dislodge his well reasoned order. 7. We find that the assessee had assailed the order of the CIT(A) on multiple grounds before us. That adverting to the specific issues on the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee, the same was duly considered by the A.O before characterising the purchase transactions as bogus. That as regards the contention of the assessee that the A.O had dislodged its book results without rejecting the books of account of the assessee, we are unable to persuade ourselves to accept the same. We are of the considered view that as the A.O had not doubted the purchase and sale of the goods, but had concluded that in the backdrop of the information received from the investigation wing and the fact that the assessee could also not lead any independent evidence in respect of the source of the purchases, therefore, the same could not be accepted at the very face of it. We are also not persuaded to be in agreement with the contention of the assessee that the A.O had merely proceeded on the basis of human probabilities and suspicion, as we find that the assessee had after duly appreciating the evidence available on record carried out the exercise of estimation of the trading results in the hands of the assessee, which we are of the considered view can safely be characterised as a well reasoned one. That as regards the objection of the assessee to the reference of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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