- (1.) THE subject matter of appeal is a judgment and order dated 15th May, 2013 by which the learned Tribunal affirmed the order of the CIT(A) and the appeal of the Revenue was dismissed. Aggrieved by the order of the learned Tribunal, the revenue has come up.
(2.) THE Assessing Officer held that purchases worth Rs. 46,77,880/ - were bogus purchases and he added back the aforesaid amount. In an appeal preferred by the assessee, the CIT (A) deleted the addition on the basis of the following reasons: I have perused the assessment order and considered the submission of the appellant. I have also considered the decisions of the Hon'ble ITAT, which are relied upon by the appellant. I find substance in the arguments of the appellant. The purchases are supported by proper bills, and, are duly recorded in the books of account. The raw hide purchased by the appellant was entered in the stock register; moreover, it was processed and utilized for producing finished leather. The sales of such finished leather are recorded in the books of account, which has been accepted by the AO. The quantitative details of raw material and finished goods are maintained by the appellant, and, also form part of the Tax Audit Report. These facts are not disputed by the AO. The AO has not pointed out any specific defects in the books of account. The AO has also not found any defect or discrepancy in the stock register, or, in the quantitative details of raw material or finished product. The ledger copies for the subsequent years show that payments were actually made to the suppliers against purchases. The gross profit rate and the net profit rate have also shown improvements. For, the gross profit rate for the current year is 11.08% as compared to 7.16% and 8.62% for the two preceding years. Similarly, the net profit ratio for the current year is 4.46% as compared to 2.68% and 2.75% for the preceding years. Simply because notice U/s. 133(6) could not be served on the suppliers can be no basis or justification for holding that the purchases are bogus. In view of the above, and, the ratio laid down by the Hon'ble ITAT, I am of the opinion that the AO was not justified in treating the purchases as bogus. The addition of Rs. 46,77,880/ - is deleted. Ground nos. 4 & 5 are allowed. The learned Tribunal dismissed the appeal preferred by the Revenue.
(3.) ONE of the questions or the only question of any substance is question no. (iv), raised by the revenue, which reads as follows: Whether on the facts and in the circumstances of the case the Learned Tribunal erred in law as it allowed the appeal filed by assessee and there is perversity for non consideration of material facts on record transpired after the detailed enquiry made by Assessing Officer and the same ought to be set aside.;