CHANDRAKANT BATESING RAGHUVANSHI,,NANDURBAR vs. ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE - DHULE , DHULE

This appeal filed by the Assessee is directed against the order of ld.Commissioner of Income Tax(Appeals)-1, Nashik proceedings under section 143(3) of the Income-tax Act, 1961 (hereinafter also called as ‘the Act’) dated 23.09.2019 for the Assessment Year 2013-14. The assessee has raised following grounds of appeal:

The Ld.Authorised Representative(ld.AR) submitted that the AO and ld.CIT(A) has not considered the affidavit filed by the SSPS Sethi Brothers from who the assessee has made purchases. The SSPS Sethi Brothers had admitted that there was mistake in the ledger account submitted to the AO under section 133(6) of the Act. The affidavit was directly submitted to the AO by SSPS Sethi Brothers.

Ld.Departmental Representative(ld.DR) for the Revenue relied on the orders of Lower Authorities.

We have heard both the parties and perused the records. The AO during the assessment proceedings called for information under section 133(6) of the Act from one SSPS Sethi Brothers from whom assessee had made certain purchases. The SSPS Sethi Brothers submitted copy of ledger account of assessee in its books of accounts. The AO noted that there were cash payments made by the A.Y. 2013-14 Mr.Chandrakant Batesing Raghuvanshi Vs. ACIT, Circle Dhule (A)

Aggrieved by the same the Assessee filed the appeal before the ld.CIT(A). Before the ld.CIT(A) the assessee claimed that the copy of the Ledger account obtained by the AO was not provided to the assessee. The ld.CIT(A) directed the AO to provide the copy of the Ledger account. Then the AO provided the copy. In response to the same the assessee filed copy of an affidavit from the SSPS Sethi Brothers that their accountant made some mistakes in the Ledger account submitted to the AO. The SSPS Sethi Brothers has accepted that the transactions appearing in the ledger account submitted by the assessee are correct. The AO and the ld.CIT(A) merely rejected the affidavit as an afterthought. The relevant portion of ld.CIT(A)’s order is reproduced here as under : “8.6 In view of the aforesaid discussion, facts of the case and applying the ratio of decision cited supra and relevant provisions of A.Y. 2013-14 Mr.Chandrakant Batesing Raghuvanshi Vs. ACIT, Circle Dhule (A)

Thus neither the ld.CIT(A) nor the AO tried to verify the authenticity of the claims made in the affidavit. They have not cross examined the accountant or the person who made the affidavit but simple rejected it.

According to the assessee during the year the transaction was only of Rs.35,48,951/-, however, admittedly out of the same Rs.20,00,318/- has been paid in cash. The transaction as submitted by the assessee is reproduced here as under : “As per account of the appellant, during the year under consideration the total transaction with M/s. SSPS Sethi Brothers, Dhule was under: Opening Balance Rs. 1,24,354/- Total Purchases:………………………...Rs. 358,48,951/- Total……. Rs. 36,73,305/- Payments by Cheques Rs. 16,72,287 Payments by Cash..…..Rs. 20,00318…Rs. 36,73,305. Total:………………… Rs. 36,73,305…Rs. NIL…….

So there is no dispute that the appellant assessee has made cash payments of Rs.20,00,318/-. The AR has not filed before this tribunal copy of the affidavit, or copy of the Ledger account to understand the facts properly nor the Ld.AR has filed copy of the bills raised by SSPS Sethi Brothers on the assessee to prove the claim. However, neither the AO nor the ld.CIT(A) has verified the cash book of the assessee and cash book of the SSPS Sethi Brothers to understand the actual payments. The AO has not verified the actual purchases made by the assessee. In these circumstances, we are of the opinion that the issue needs to be verified properly by the AO, therefore, we set aside the issue to the file of the AO for proper verification. The Assessee shall file all the relevant documents before the AO at the earliest. The AO shall provide opportunity to the assessee.

Accordingly, the grounds of appeal raised by the assessee are allowed for statistical purpose.