9911796707
TMI Blog2022 (6) TMI 967X X X X Extracts X X X X X X X X Extracts X X X X ..... AY 2015-16. 2. The grounds of appeal raised by the assessee reads as under: 1. That the Ld. CIT(A) has erred in confirming the disallowances of Rs.88,670/- made u/s 14A of the Act, ignoring the principles laid down by Hon'ble Supreme Court in case of PCIT vs. Sintex Industries [2018] 93 taxmann.com 24 (SC). 2. That the Ld. CIT(A) has erred in confirming the purchases as bogus, to the tune of Rs.6,50,160/-calculated at Average G.P. Rate @ 16.26% of Rs.39,98,522/-, inspite of the following facts & submission made before her. (a) That payments to the suppliers have been made through RTGS, banking channels; (b) That the assessee has paid Entry Tax of these purchases, while entering goods in Punjab; (c) That the goods so purchased are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arried out at the premises of Shri Ram Prakash Bhatia and on the basis of statement recorded of Shri Ram Prakash Bhatia, the genuineness of purchases made by Assessee from M/s. Rishabh Foods amounting to Rs.39,98,522/- were doubted and aspersions were cast at the genuineness of purchases (cotton) claimed to have been made by the assessee from the aforesaid party. The Assessing Officer accordingly made an addition of Rs.7,99,704/- estimating profit embedded in such bogus purchase at 20%. 6. Aggrieved, the assessee preferred appeal before the CIT(A). The CIT(A) has endorsed the action of the Assessing Officer in principle but however modified and scaled down the amount of disallowance to Rs.6,50,160/- applying the average GP rate @ 16.26% in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uantity has been entered and finished goods produced out of it and sold to its customers; VAT returns showing the said purchases together with bank statement showing payment made through banking channels. The assessee also contends that the quantity details have not been disturbed by the Assessing Officer nor the books of account have been rejected and / or any discrepancy was shown therein. The assessee thus contends that in the backdrop of these elaborate documentation, the purchases made by the assessee running large scale business and showing huge profits could not have been discarded summarily on the basis of some unverified statement of one Shri R.P. Bhatia whose connection with the supplier M/s. Rishabh Foods has not been established ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tia for a just and fair decision making. The Revenue has denied this valuable right and thus infringed the salutary principles despite request from the assessee before the lower authorities. Thus, the statement of Shri Bhatia is to be regarded as an extraneous to the determination of the issue. Once the statement of Shri Bhatia has excluded, the conclusion is obvious in the light of the documentary evidences towards its bona fides as claimed. Therefore, we find merit in the plea of the assessee for reversal of unjustified additions. Consequently, the order of the CIT(A) is set aside and the additions made towards bogus purchases are reversed. 10. In the result, the appeal of the assessee is allowed. Order pronounced in the open Court on 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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