K R SOLVENT LLP,SURENDRANAGAR vs. DCIT, CIRCLE 4(1)(1), AHMEDABAD, AHMEDABAD

The assessee has raised the following grounds of appeal: “1. The Ld. CIT(A) has erred in law as well as on fact by upholding an addition made by Ld. AO amounting to Rs. 8,30,800/- being purchase treated as non-genuine and disallowed u/s 37 of the Act. 2. The Ld. CIT(A) has erred in law as well as on fact by dismissing appeal of assessee treating it as bogus purchase despite of producing ample evidences in the course of assessment and appellate procedure.”

The assessee filed return of income u/s 139(1) on 09.10.2019 declaring total income of Rs. 29,41,766/- for A.Y. 2019-20. As per information, the

Being aggrieved by the Assessment order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal.

The Ld. AR submitted that the assessee has submitted all the relevant documentary evidences in the form of Purchase Bills/Invoices, evidences of transport of goods i.e. delivery challan, stock register details, bank details showing payment through banking channel to Shri Bharatbhai Trikamal Pandya, GST Returns, details of godown, copy of ledger account of Shri Bharatbhai Trikamal Pandya maintained in the books of assessee, complete personal details such as PAN, address of Shri Bharatbhai Trikamal Pandya. The Ld. AR further submitted that Shri Bharatbhai Trikamal Pandya passed away on 19.09.2019 (death certificate was submitted to the Assessing Officer) and closure of his business after his death. The affidavit of the son of Late Shri Bharatbhai Trikamal Pandya was submitted to the Assessing Officer. The Ld. AR submitted that the purchase was genuine and in fact the sale was also duly reflected in the

The Ld. DR relied upon the Assessment Order and the order of the CIT(A).

Heard both the parties and perused all the relevant material available on record. From the perusal of records, the Assessing Officer has not taken into account that Shri Bharatbhai Trikamal Pandya passed away on 19.09.2019. Thus, the proprietory concern business also stopped due to his demise. These facts were brought on record by the son of the said Shri Bharatbhai Trikamal Pandya. Therefore, the conclusion of the Assessing Officer as well as CIT(A) that there was no response from seller cannot be held responsible under these circumstances. In fact, the assessee has stated the valid facts of the said party’s demise during the very same year when the GST registration was cancelled. In fact the invoices, bills of transportation of goods and other details are prior to the demise of Shri Bharatbhai Trikamal Pandya. These facts cannot be ignored by the Revenue. The Revenue is accepting the sale and has not disputing the same or pointing out any discrepancy in the purchase qua the sale. Therefore, merely GST registration cancellation due to demise of the party cannot be the whole and sole criteria for making the addition and disallowing the purchases. Thus, the addition made by the Assessing Officer and confirming the same by the CIT(A) are not justified. The appeal of the assessee is allowed.

In result, appeal of the assessee is allowed.