PIYUSH AGRAWAL,J. - (1.) The present appeal has been filed under section 260-A of the Income Tax Act, 1961 (hereinafter referred to as, 'the Act') against the judgment and order dated 13.04.2017 passed in Income Tax Appeal No. 3895/Del/2013 (Assessment Year 2009-10) by the Income Tax Appellate Tribunal, Delhi, Bench 'E', New Delhi (hereinafter referred to as, 'the Tribunal').
(2.) On 04.10.2017, the present appeal was admitted by this Court on the following questions of law: "A. Whether on the facts and circumstances of the case, the ITAT has erred in law and fact by not setting aside the issue of addition of Rs. 3,38,72,852/- on non-genuine purchases to the file of the CIT(A) while the learned ITAT quashed the direction of CIT(A) on the same especially in view of the fact that the ITAT is the ultimate fact finding authority, it should have either settled the issue on the basis of material on record or set aside the matter to the CIT(A) for deciding within the powers vested in it?"
(3.) The facts of the case are that the assessee - respondent is engaged in the business of manufacture and sale of wheat products, like maida, suji, aata and bread. For the year under consideration, the respondent - assessee filed return of income on 25.09.2009 declaring income of Rs. 47,26,344/- in the status of a Company. The return was processed under section 143(1) of the Act and later on, the case was selected under the scrutiny with the approval of Chief Commissioner of Income Tax, Ghaziabad. On 23.09.2010, notice under section 143(2) of the Act was issued fixing the date of hearing as 28.09.2010. The notice was duly served. Thereafter, notice under section 142(1) of the Act was issued along with the questionnaire dated 12.02.2011 fixing the date of hearing as 23.02.2011. In response to the said notice, details were furnished by the respondent - assessee. In order to verify the genuineness of purchase declared by the assessee - respondent, notices under section 133(6) of the Act were issued to 19 parties, out of which, notices upon two parties, namely, Mohit Trading Company, A-1/307, Sector - 6, Rohini, Delhi - 85 and Surana Brothers, C - 106, MP Enclave, Pitampura, Delhi - 34, were returned back unserved. The total purchase of the said two parties were declared to the tune of Rs. 3,38,72,852/-. The Assessing Authority, while framing the assessment order, has observed as under:- "Since both the addresses were of residential colonies in Delhi, where possibility of existence of any such entity that could supply the material worth crores without maintaining and godowns was not there, the field verifications were made. It was found that at both these addresses, no such companies existed. Vide order sheet entry dated 28.12.2011, this fact of their non-existence at the address provided was brought to the knowledge of the assessee. Since the parties have not been found at the address provided by the assessee, assessee has also not filed their confirmed copy of the account, these purchases of Rs. 3,38,72,852/- are not treated as genuine. Accordingly, they are being added to the income of the assessee as non-genuine purchases." ;