- (1.) This appeal under s. 260A of the IT Act, 1961 against the order dt. 13th Dec., 2013 passed by the Income-tax Appellate Tribunal 'C' Bench, in ITA No. 1209/Kol/2009 for the asst. yr. 2005-06 has been preferred by the Revenue on the following questions: "(i) Whether on the facts and in the circumstances of the case the learned Tribunal erred in law and was not justified in dismissing the appeal filed by Revenue on the issue of addition of Rs. 30,93,325 made by the AO for undisclosed cash purchases and introducing bogus sundry creditors. (ii) Whether on the facts and in the circumstances of the case the learned Tribunal erred in law and was not justified in dismissing the appeal filed by Revenue on the issue of addition of Rs. 30,93,325 made by the AO for undisclosed cash purchase and introducing bogus sundry creditors is perverse keeping in view the fact that the AO had irrefutably proved these facts after making an extensive enquiry. (iii) Whether on the facts and in the circumstances of the case the learned Tribunal erred in law and was not justified in dismissing the appeal filed by Revenue is perverse keeping in view the non-consideration of following facts: (a) Out of seven sundry creditors in relation to which addition was made by the AO, four were proprietary concerns of one individual and three were proprietary concern of another individual and a genuine businessman would not float multiple proprietary concerns for the same business. (b) None of the seven sundry creditors for whom addition was made was available at the address given by the assessee on inquiry through Inspector and the assessee was unable to provide their latest address despite sufficient opportunity given during assessment proceedings. (c) The amount given to the purported sundry creditors through cheque in subsequent years was either withdrawn in cash or transferred to proprietary concerns of the same persons. (d) Almost entire purchase purportedly made from these sundry creditors were outstanding at the end of the previous year which is not a normal business practice. (e) Payment by cheque by itself does not prove that the purchases/sundry creditors were genuine, especially, in view of the facts mentioned above. (iv) Whether on the facts and in the circumstances of the case the learned Tribunal erred in law and was not justified in dismissing the appeal filed by Revenue without considering the facts of the case as well as applicable statute in the case and is therefore,-perverse and liable to be set aside." Heard Ms. A.G. Ghutghutia, learned advocate appearing for the appellant/petitioner, and Mr. Ananda Sen, learned advocate for the respondent-assessee.
(2.) In support of her contention, Ms. A.G. Ghutghutia relied upon two decisions, one is in Civil Appeal No. 2540 of 2007 [CIT v. P. Mohanakala & Ors., 2007 210 CTR 20 and the other is unreported judgment in IT Appeal No. 493 of 2013 [CIT v. Empire Budtech (P) Ltd.] which are of no help to the Revenue in the facts and circumstances of this case.
(3.) We find that the AO had called for information from the Branch Manager, Vijaya Bank, N.S. Road Branch, Kolkata-1 of which the assessee was the constituent under s. 133(6} of the Act and had found as under: "To verify the genuineness of the claim of payment against purchase for the year, vide this office letter No. ITO, Ward-35(4)/Kol/2007-08/1063 dt. 4th Dec, 2007, an information was sought under s. 133(6) of the Act, from the Branch Manager, Vijaya Bank N.S. Road, Branch, Kolkata-1 regarding the name of the clearing bank, branch and name of the account holder where those cheques have been cleared. The reply of the branch manager reveals that the cheques issued from the bank account of the assessee (Vijaya Bank, N.S. Road, Kolkata-1) have been cleared in the name of the above concern to following bank and branch.";