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TMI Blog2020 (10) TMI 1087X X X X Extracts X X X X X X X X Extracts X X X X ..... ills. AR could not point out any material on record to show that the above concerns from whom the purchases made, were in fact carrying out any commercial activity and were maintaining stocks. Presumption of correctness is attached with the statement recorded U/s 132(4) of the Act as the said statement was recorded by the officials of the IT department during discharge of their official duties and since the said statement is recorded on oath, therefore, the presumption of correctness is attached with the said statement until it is rebutted or uprooted by the assessee. We also noticed that the ld. CIT(A) while reaching to the conclusion on the basis of material placed on record had held that since the assessee has failed to justify the purchases made by him, therefore, had rightly invoked the provisions of Section 145(3) - since the assessee failed to substantiate the purchases of ₹ 90,42,850/-, therefore, keeping in mind, the better trading results declared by the assessee, a lumpsum addition of ₹ 10.00 lacs were sustained. - Decided against assessee. - ITA No. 557/JP/2019 - - - Dated:- 21-10-2020 - Shri Sandeep Gosain, JM And Shri Vikram Singh Yadav, AM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal of the assessee be disposed off by considering the written submissions as the assessee do not want to address oral arguments, therefore, considering the specific submissions made by the assessee vide letter dated 26/09/2020, we have heard the appeal by providing opportunity of hearing to both the parties. 7. On the other hand, the ld DR had addressed the submissions on behalf of the revenue and relied upon the impugned order passed by the ld. CIT(A) and also relied upon the decision of the Hon ble Supreme Court in the case of C. Vasantlal Co. Vs CIT 45 ITR 0206. 8. We have heard the ld. DR and have also gone through the written submissions filed by the assessee. We have also deliberated upon the decisions cited in the orders passed by the authorities below as well as cited before us and we have also gone through the orders passed by the revenue authorities. Before we decide merits of the appeal, it is necessary and imperative to evaluate the order passed by the ld. CIT(A) while disposing of the appeal. The ld. CIT(A) has discussed the grounds raised by the assessee in para Nos. 2.3 and 2.3.1 of her order and the same is reproduced below: 2.3 Ground No. 01 to 04 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mentioned persons/ firms were genuine and the payments for the purchases of materials were made through account payee cheques and thus, in this way, it was the case of the assessee that the transactions in respect of which they had maintained accounts were genuine transactions. It was also submitted in the written submissions filed by the assessee that the A.O. had not provided any opportunity for cross examination of the assessee in respect of the statement recorded that of Shri Bhanwar Lal Jain etc. After having gone through the facts of the case and after going through the written submissions filed by the assessee and hearing of the ld DR at length, we found that there is nothing on record to show that the ITO had not disclosed to the assessee, the material he had collected from the Investigation Wing of the Income Tax Department. The ITO/AO is not bound by any technical rules of law of evidence. It is open to him to collect materials to facilitate the assessment even by private enquiry but if he desires to use the said material so collected, then in that eventuality, the assessee must be informed of the material and must be given an adequate opportunity of explaining it. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on sh. Rajesh Jain, the said consignment still appear as stock since the material has been sold to the real importer out of books. To show sale against the bogus stock outstanding in your books, bogus sale bill are issued to parties against their purchase made in cash. These parties who take accommodation entries from your concerns make payment through RTGS. This RTGS is in turn used to make payment to the foreign parties from whom import has been made. The parties who have been given payment for such bogus purchase through RTGS want their cash back. In the meantime, the real importer on whose behalf import has been made, makes the payment for the said import through angaria (cash transaction). On the contrary, the ld AR could not point out any material on record to show that the above concerns from whom the purchases made, were in fact carrying out any commercial activity and were maintaining stocks. The Hon ble Supreme Court in the case of C.Vasantlal Co Vs CIT (supra) had clearly held that the A.O. is not bound by any technical rules of the law of evidence. It is open to him to collect materials to facilitate assessment even by private enquiry. But if he desires to use th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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