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TMI Blog2021 (9) TMI 845X X X X Extracts X X X X X X X X Extracts X X X X ..... the parties. 3) Whether worthy Commissioner of Income Tax (Appeal) was right in ignoring the material facts of the case that there was difference in the quality and quantity of goods purchased and goods sold by the assessee which is contrary to the assessee's claim that he had directly sold the goods without taking delivery itself. 4) Appellant craves leave to amend or add any one or more grounds of appeal. The assessee had also filed the Cross objection against the order passed by the CIT(A) whereby the CIT(A) had enhanced GP rate of the assessee at 25%. 1. At the outset, the Ld. DR, drawn our attention to the order passed by CIT(A), wherein he had decided as under:- "The AO has not commented on those transactions of purchases where description of item, quantity of item, weighment slips, octroi slips are available and as such there is no discrepancy as per AO's own standards in this regard. the AO has treated all these transactions by same bat. The AO has presumed weighment slips are also fabricated and have been prepared to cover up the bogus purchases. This conclusion has been on the basis of fluctuation shown in the tare weight of the truck as mentioned in tabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tten to M/s. Nyka Steels Pvt. Ltd. that they can also supply materials from their sisters. Asian Tube Trading, Mumbai subject to maintenance of same paint quality a+icn clearly proves that M/s. Asian Tube Trading, Mumbai was part of M/s. Nyka Steels Pvt. Ltd. In similar circumstances Jurisdictional High Court has held in the case of CIT vs. Leaders Valves Pvt. Ltd. 285 ITR 435 that as consumption stood fully proved the existence of parties can not be denied. In this case it was also held that if purchases are treated as bogus it would be impossible to manufacture the goods shown to have been manufactured. Similarly in the present case it would be impossible to have such quantitative sale and profits in absence of such purchases. The assessee has shown overall G.P. margin of 14.18%, whereas, the assessee has shown G.P. Margin of 18.14% on purchases/sale related to M/s. Asian Tube Trading, (without VAT) which clearly demonstrate that assessee has made huge profit on these purchases which have been accepted by the AO also. No doubt, assessee was not able to provide all evidences related to these transactions such as weighment slips, OctoroiSlies & Freight payment invoices, however ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are not available in bills he could not provide any answer. From the details of trucks for the purchase in the reply dated 21.01.2014 it was noted that mostly the truck number, MH43U2988 was used. Counsel was asked during the course of hearing, whose truck it was. He said may be it belonged to M/s. Asian Tube Trading. Since it was surprising that same truck was used to deliver the items to the parties to whom items were sold by the assessee, counsel was asked how this surprising arrangement was made. Counsel. submitted that someone from assessee's firm went along with truck driver and ensured the delivery of items to the parties. However, on next date of hearing counsel retracted from this statement and said that truck belonged to assessee firm instead and it picked the items from M/s. Asian Tube Trading and then delivered the same to the parties to whom they were sold. Clearly this is fabricated argument, made to cover up the bogus purchase. To further enquire into the matter, letter u/s. 133(6) was issued to the M/s. Asian Tube trading on 27-01-2014. Postal authorities returned this letter with remark "left". It Clearly when this firm, M/s. Asian Tube trading, was caught ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alf, out of amount due in the account of M/s. Nyka Steels Pvt. Ltd. So much so we have filed a complaint with police u/s. 420 etc. of IPC dated 14.08.2013, copy of complaint letter with police is enclosed at page 697 to 700." Through this submission assessee himself admitted that M/s. Asian Tube Trading had submitted before Mumbai Sales Department that it had been providing Parties and no goods was ever sold. Other argument of assessee like, assessee having GR, Weighing slip had already been exposed earlier, and thus, are baseless. Further it is to bring on record that no octroi slip had ever been produced before undersigned relating to purchase from M/s. Asian Tube Trading. Thus, this argument is misleading." 3. Based on the above order of the AO and CIT(A), it was contended by the Ld. DR that there is inherent contradiction in the finding recorded by the CIT(A) vis a vis assessment order, Firstly AO, had issued the notice under section 133 (6) to the M/s. Asian Tube Trading, Secondly assessee had admitted to have received bogus purchase/fictitious bills from said company and lastly assessee had deposited the sale tax to the VAT department, thereby acknowledging receipt of Bogu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to the AO, on 21 January 2014, assessee, had admitted that bills issued by Asian tube trading were fictitious and the assessee had deposited the sale tax demand of M/s. Asian Tube Trading with the department so that the demand against M/s. Asian Tube Trading be not enforced and recovered from the assessee. (refer assessment order, supra). It was also the case of the assessee that the first information report was registered against the company on the complaint of the assessee. 6. In our considered opinion all the above said aspects were required to be examined and considered by the CIT(A) while passing the impugned order, however none were considered by CIT(A) and he had passed order in stero type and criptic manner .As the order was passed by the CIT(A), in stero type and criptic manner, after ignoring the important admitted facts regarding the issuing of notices under section 133(6) of the Act, admissions of assessee of paying the Sales tax on behalf of Asian Tube Trading, registration of FIR, etc therefore In our considered opinion, the matter is required to be remanded back to the file of CIT(A) to decide the grounds raised by the assessee, a fresh following law. 7. In the ..... 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