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TMI Blog2022 (7) TMI 1130X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Deepesh Garg , Adv Respondent by : Shri H. K. Choudhary , CIT-DR ORDER Per Pradip Kumar Kedia , AM The captioned Appeals arises from the respective order of CIT(A) for different assessment years tabulated hereunder: ITA No. A.Y. Assessee Assessment order date CIT(A) Order Appeal by 7654/Del/2019 2013-14 Shri Subhash Chander Gupta 26.12.2017 CIT(A)- 3, Gurgaon, order dated 23.07.2019 Assessee 7655/Del/2019 2014-15 Shri Subhash Chander Gupta 26.12.2017 CIT(A)- 3, Gurgaon, order dated 23.07.2019 Assessee 7656/Del/2019 2015-16 Shri Subhash Chander Gupta 26.12.2017 CIT(A)- 3, Gurgaon, order dated 23.07.2019 Assessee 7657/Del/2019 2014-15 M/s. Starline Clothing P. Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gal also for the reason that these could not have been made since no incriminating material has been found as a result of search. 6. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in passing the impugned assessment order without there being requisite approval in terms of section 153D and in any case approval if any is mechanical without application of mind and is no approval in the eyes of law. 7. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in not reversing the action of Ld. AO in charging interest u/s. 234B of Income Tax Act, 1961. 8. That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other. 3. When the matter was called for hearing, ld. counsel for the assessee referred to substantive grounds no. 3, 4 and 5 and submitted that once these grounds are determined on the basis of facts on record, adjudication of other grounds would not be necessitated. 4. On facts, the assessee is engaged a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment years, the Tribunal on examination of facts, in the case of the recipient of services found the expenditure claimed by the corresponding company to be genuine. On appraisal of documentary evidences, the Tribunal found the genuineness of job work carried out by Shri Ram Exports, a proprietary concern of the assessee. 5.1. The relevant operative paragraphs of the order of the Tribunal were adverted in this regard which is reproduced hereunder: 37. It is thus seen from the evidences placed before us and relied upon by Ld. Counsel for the assessee that the job worker M/s. Shri Ram Export has raised invoices on the assessee company and payment have been made by the assessee company to the job worker through account payee cheques and tax having been deducted at source and documents at page 598 to 605, 908-1613 of the paper book establish the existence of the job worker and the job work carried out by M/s. Shri Ram Exports. We have also seen the evidences referred at page 2974 to 2976 of the paper book, which also establish the job work done by M/s. Shri Ram Export. We have also referred to the copies of the relevant documents filed before the lower authorities from the W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re us and we find that the evidences filed by the assessee to prove genuineness of the job work have not been found fault with by CIT(A) and there is no corroborative evidence produced against the assessee. We further find that CIT(A) mis-appreciated the nature of job work being done by this job worker and was not related to the assessee company or its directors. Statement of the wife of the proprietor cannot be used against the assessee. In the result grounds of appeal of the assessee in this regard are allowed the addition of Rs. 6,41,39,357 is hereby deleted. 5.2. The ld. counsel for the assessee submitted that where a clear finding of fact has been recorded by the Co-ordinate Bench of Tribunal in the hands of Orient Crafts, i.e., user of the job work services that the job work charges incurred by the Orient Craft through assessee are genuine, the whole allegation against the Assessee also is belied and fades into oblivion and does not survive. The ld. counsel accordingly urged for deletion of the addition sustained by the CIT(A) in respect of Assessment Year 2013-14, 2014-15 and 2015-16 as per captioned appeals. 5.3. The ld. DR for the Revenue, on the other hand, reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITA No. 7654, 7655, 7656/Del//2019 are allowed. 8. The grounds of appeal raised by the assessee in ITA No. 7657/Del/2019 reads as under: ITA No. 7657/Del/2019 (Assessment Year 2014-15) 1. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in assuming jurisdiction u/s. 153C and that too for this year and further erred in passing the impugned assessment order, more so when 'satisfaction' has not been recorded by AO of the searched person and when there was no incriminating document was found. 2. That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in assuming jurisdiction and framing the impugned assessment order u/s. 153C, is bad in law and against the facts and circumstances of the case and the same is not sustainable on various legal and factual grounds. 3. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in exercising his jurisdiction in making addition of Rs. 1,88,248/- (i.e. 5% of Rs. 37,64,954/-) on account of alleged commission/brokerage as business i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as raised bills for supply of fabrics to M/s. Orient Crafts Ltd. which, in turn, has booked purchases of Rs. 37,64,954/- made from the assessee-company instead of job work services rendered in the case of Subhash Chander Gupta. Likewise, supply has been carried out in Assessment Year 2015-16 amounting to Rs. 1,00,82,436/- also. The CIT(A) has computed the addition of Rs. 1,88,248/- and Rs. 5,04,122/- for Assessment Years 2014-15 and 2015-16 in question being 5% of the invoices raised on Orient Craft Ltd. similar to Subhash Chander Gupta case. 10. In the backdrop of these facts, the allegation of non genuine purchases of fabric made by the orient Craft Ltd. from the assessee herein has been reversed by the Tribunal with following observations: 46. The material when received from the above said concern, is evidenced with the help of Annexure-D reply letter 08.12.2017 i.e. purchased invoice of fabric, fabric receipt note, gate pass inward etc, enclosed in the paper book at PB 1328-1559(which is already enclosed in the paper book for A.Y. 2011-12 in assessee's own case) on sample basis. Apart from this, the material/fabric purchased from the above concern has been used in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the appellant company for material consumption as a percentage of sales, (which is already enclosed in the paper book for A.Y. 2011-12 in assessee's own case). PB 2341-2377 is the standard input/output norms as prescribed under handbook of procedure volume-II of Foreign Trade Policy published by Ministry of Commerce, (which is already enclosed in the paper book for A.Y. 2011-12 in assessee's own case). 48. In other words, Ld. Counsel submitted that the fact that the purchases were made from the above said concern was proved and established by the assessee from the detailed description contained in the above said reply dated 06.12.2017 (PB 289-291), 08.12.2017 (PB 292-293) 12.12.2017 (PB 294-295) and with the help of several evidences, which are part of the paper book at PB 417-419, 420-489, 1044-1045, 1159-1186, 1187-1235, 2313-3832 (which is already enclosed in the paper book for A.Y. 2011-12 in assessee's own case. 49. Therefore, it was not justified on the part of Ld. AO to have treated the purchases of fabric as non genuine transaction/purchases. In fact without the purchases, it was not possible that the production could have been made and since ..... X X X X Extracts X X X X X X X X Extracts X X X X
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