SITA RAM SHARMA, Jaipur V. ACIT, Jaipur

ITA 181/JPR/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5477 (ITAT-JAIPUR)
• Duration Of Justice: 11 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-02-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 23-02-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KAILASH MANGAL JCIT DHK
• Assessee Lawyers: TANUJ AGARWAL
• Keywords: Bogus purchase; Depreciation; Opportunity of being heard; Principle of natural justice
• Section: 143(3); 131; 37; 6; 68

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VH-VKJ-EHUK] YS[KK LNL; ,OA JH YFYR DQEKJ] U;KF; D LNL; DS LE{K BEFORE: SHRI T.R.MEENA, AM & SHRI LALIET KUMAR, JM VK;DJ VIHY LA -@ ITA NO. 181/JP/2015 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2009-10 DR. SITA RAM SHARMA, PROP.- M/S SHARMA HOSPITAL, NEAR CHUNGI NAKA, CHOMU. CUKE VS. A.C.I.T. CIRCLE-7, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. AMVPS 4422 K VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI TANUJ AGARWAL (CA) JKTLO DH VKSJ LS@ REVENUE BY : SHRI KAILASH MANGAL (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 04/01/2016 MN?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 12/02/2016 VKNS'K@ ORDER PER T.R. MEENA, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 30/01/2015 OF THE LEARNED CIT(A)-III, JAIPUR FOR A.Y . 2009-10. THE EFFECTIVE GROUNDS OF APPEAL ARE AS UNDER:- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE LD CIT(A) GROSSLY ERRED IN SUSTAINING AN ADDITION OF RS. 4,22,209/- MADE BY THE ASSESSING 2 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT OFFICER TOWARDS ALLEGED BOGUS PURCHASES FROM THE FOLLOWING PARTIES. S. NO. NAME OF THE SUPPLIER GOODS PURCHASED DESCRIPTION AMOUNT OF PURCHASES RS. AD DITION SUSTAINED RS. % 1 DEVI DISTRIBUTORS & SURGICARE OPERATION MATERIAL 41,227 41,277 100 2 KARNI ENTERPRISES DIAGNOSTIC MATERIAL 3,80,892 3,80,982 100 TOTAL 4,22,209 4,22,209 100 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE LD CIT(A) GROSSLY ERRED IN SUSTAINING ENTIRE DISALLOWANCE IN RESPECT OF PURCHAS E OF X-RAY FILMS AMOUNTING TO RS. 24,919/-. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) GROSSLY ERRED IN SUSTAINING AN ADDITION OF RS. 59,700/- U/S 68 ON ACCOUNT OF VARIO US TRADE CREDITORS OUTSTANDING AT THE BALANCE SHEET DA TE AS UNDER:- S.NO. NAME OF THE TRADE CREDITOR OUTSTANDING BALANCE AT THE YEAREND ADDED BY A.O. & SUSTAINED BY CIT(A) RS. 1. M.K. SURGICAL SUPPLIERS 22,786 2. RAJPUTANA BIOTECH PVT. LTD. 1,248 3. SANTOSH BATTERY SERVICE 6,200 4. SHREE LAXMI MEDICOSE 4,345 5. SURGIMED 25,139 TOTAL 59,700 2. THE ASSESSEE HAS INCOME FROM RUNNING OF HOSPITALS . HE FILED RETURN FOR A.Y. 2009-10 ON 25/09/2009 AT RS. 16,56,920/- A ND AGRICULTURAL 3 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT INCOME OF RS. 42,500/- HAD ALSO BEEN DECLARED. THE C ASE WAS SCRUTINIZED U/S 143(3) OF THE INCOME TAX ACT, 1961. THE FIRST GRO UND OF THE ASSESSEES APPEAL IS AGAINST MAKING ADDITION ON ACC OUNT OF BOGUS PURCHASES. THE LD ASSESSING OFFICER HAS OBSERVED THA T ON VERIFICATION OF BOOKS OF ACCOUNT, IT WAS FOUND THAT NO PROPER SYSTEM /RECORD FOR MAINTAINING PURCHASE AND SALE HAS BEEN FOLLOWED BY T HE ASSESSEE. THE ASSESSEE HAD SHOWN TOTAL PURCHASE OF RS. 13,35,806/ - DURING THE YEAR UNDER CONSIDERATION. THE ASSESSEE HAS NOT MAINTAINED STOCK REGISTER TO ESTABLISH THE GENUINENESS OF THE PURCHASES MADE. THE LD ASSESSING OFFICER SUMMONED THE FOLLOWING PARTIES:- NAME OF THE PARTY PURCHASE MATERIAL AMOUNT BHARGAWAS HI TECH SURGIMED CO. PVT. LTD. OPERATIONAL MATERIAL 201894 DEVI DISTRIBUTORS & SURGICARE OPERATIONAL MATERIAL 41227 KARNI ENTERPRISES DIAGNOSTIC MATERIAL 380982 HE FURTHER OBSERVED THAT THE SUMMON ISSUED TO DEVI DISTRIBUTORS & SURGICARE AND KARNI ENTERPRISES HAD NOT BEEN SERVED AS THE FIRM DID NOT CARRY OUT ANY BUSINESS FROM THE SPECIFIED ADDRESS A NY MORE AND NO SUCH ADDRESS AS SPECIFIED IN THE LETTER EXISTED AS PER I NSPECTORS REPORT DATED 13/10/2011. DURING THE COURSE OF STATEMENT RECORDED OF SHRI RAJENDRA KUMAR BHARGAVA, MARKETING MANAGER OF M/S BHARGAVA H I TECH SURGIMED 4 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT CO. PVT. LTD., HE SENT SOME OF THE ITEMS TO THE ASS ESSEE THROUGH CHALLANS. THESE CHALLANS WERE NOT VERIFIABLE FROM THE BOOKS OF ACCOUNT OF THE ASSESSEE. SHRI BHARGAVA ADMITTED THAT SURGICAL ITEM S WERE SENT TO M/S SHARMA HOSPITAL, CHOMU BY CHALLAN AND SOME OF THE I TEMS RECORDED ON THE CHALLANS WERE RETURNED BACK BY THE HOSPITAL DUE TO NON UTILIZATION IN THE HOSPITAL AND WHEN THE ITEMS WERE RECEIVED BACK BY M/S BHARGAVA HI TECH SURGIMED CO. PVT. LTD., JAIPUR THEN BILL WAS ISS UED TO THE ASSESSEE. THE ASSESSING OFFICER HELD THAT THERE IS NO SYSTEMAT IC RECORDING OF PURCHASE IN THE BOOKS OF ACCOUNT AND PURCHASES TO T HE EXTENT EXAMINED REMAINED UNVERIFIABLE AND NON-ESTABLISHED. THEREFORE , THE PURCHASES MADE FROM M/S DEVI DISTRIBUTORS & SURGICARE AND KAR NI ENTERPRISES AT RS. 4,22,209/- WAS DISALLOWED AND ALSO 20% OUT OF PURCHA SES MADE FROM M/S BHARGAVA HI TECH SURGIMED CO. PVT. LTD., OF RS. 2,01,894/- WAS ALSO DISALLOWED AND TOTAL ADDITION OF RS. 4,62,588/- WAS M ADE IN THE INCOME OF THE ASSESSEE. 3. BEING AGGRIEVED BY THE ORDER OF THE LD ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD CIT(A), W HO HAD PARTLY CONFIRMED THE APPEAL ON THIS ISSUE BY OBSERVING AS UNDER:- 5.3 I HAVE CAREFULLY CONSIDERED THE FINDINGS OF T HE AO AS ALSO THE SUBMISSION OF THE APPELLANT. AS REGARDS 5 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT PURCHASES FROM M/S DEVI DISTRIBUTORS AND SURGICARE AS WELL AS FROM M/S KARNI ENTERPRISES AMOUNTING TO RS. 41227/- AND RS. 380982/- IT IS NOTED THAT BOTH THES E CONCERNS WERE NOT FOUND EXISTING ON THE; GIVEN ADDRE SS. IT IS ALSO UNDISPUTED FACT THAT THE AO HAS REQUIRED THE ASSESSEE TO PRODUCE THE RESPONSIBLE PERSONS / OWNERS OF THE CONCERNS FOR EXAMINING THE GENUINENESS OF THE PURCHASES AND THAT THE APPELLANT HAS FAILED TO PROD UCE SUCH PERSON BEFORE THE AO. IT MAY BE MENTIONED THAT THE PURCHASES ARE SHOWN BY THE ASSESSEE AND THEREFOR E THE ONUS WAS ON THE ASSESSEE TO PROVE GENUINENESS OF THE PURCHASES. SIMPLY FILING OF PURCHASE BILLS ETC. MAY NOT PROVE THE GENUINENESS OF THE PURCHASES. IN THES E CIRCUMSTANCES THE AO HAS RIGHTLY DISALLOWED SUCH CLA IM AND HAS MADE ADDITION OF RS. 422209/-. AS REGARDS PURCHASES FROM BHARGAVA HI TECH SURGIMED CO. PVT. LT D . AMOUNTING TO RS. 201894/- WHERE THE AO HAS DISALLOWE D 20% OF CLAIM IT IS NOTED THAT THE MARKETING MANAGER OF THE CONCERN ADMITTED TO HAVE MADE SUCH SALES. AS REGARDS SOME CHALLANS THOUGH WHICH SOME GOODS WERE RECEIVED BY THE ASSESSEE WHICH WERE SUBSEQUENTLY RETURNED TO THE SELLER PARTY, PROPER SYSTEM AS TO H OW SUCH RETURNED ITEMS WERE ACCOUNTED FOR AND REVISED INVOICE WAS ISSUED ACCORDINGLY WAS STATED BEFORE THE AO. IT IS NOT A CASE WHERE EITHER THE PURCHASES WERE NOT MADE OR THE PURCHASES WERE NOT RELATED TO THE BUSINE SS 6 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT AND IN THIS BACKGROUND THE DISALLOWANCE OF 20% OF PURCHASES WAS WITHOUT ANY BASIS. ACCORDINGLY ADDITION TO THE EXTENT OF RS. 40379/- IS DELETED. ACCORDINGLY T HE APPELLANT GETS RELIEF OF RS. 40379/-. THE GROUNDS O F APPEAL ARE PARTLY ALLOWED. 4. NOW THE ASSESSEE IS IN APPEAL BEFORE US. THE LD AR OF THE ASSESSEE HAS SUBMITTED THAT THE LD ASSESSING OFFICER HAD NOT REJECTED THE BOOKS U/S 145(3) WHILE ENHANCING THE OPERATING RESULT THRO UGH DISALLOWANCE OF THE ENTIRE PURCHASES FOR WHICH HE RELIED ON THE DEC ISION OF HONBLE ITAT, JAIPUR BENCH IN THE CASE OF ACIT VS M/S BAL KISHAN N YALI HUF IN ITA NO. 1122/JP/2011 DECIDED ON 25/07/2014, WHEREIN IT HAS BEEN HELD THAT THE TRADING ADDITION BY WAY OF ESTIMATING OF YIELD CANNO T BE DONE IN ABSENCE OF REJECTION OF BOOKS OF ACCOUNT. HE FURTHER ARGUED THAT THE ASSESSEE HAD SUBMITTED PURCHASE BILL AND CHALLAN ISSUED BY M/S D EVI DISTRIBUTORS & SURGICARE CONTAINING THEIR COMPLETE ADDRESS, DRUG L ICENSE NO., SALES TAX REGISTRATION NUMBER AND OTHER DETAILS. VAT HAS ALSO BEEN CHARGED BY THE SUPPLIER ON SALES. THE LD AR HAS DRAWN OUR ATTENTION ON PAGE NO. 7 TO 9 OF PAPER BOOK AND ARGUED THAT THE ASSESSEE REGULARL Y PURCHASING GOODS FROM BOTH THE PARTIES I.E. M/S DEVI DISTRIBUTORS & SURGICARE AND KARNI ENTERPRISES. THE ASSESSEE HAD MAINTAINED PROPER BOOK S OF ACCOUNT, WHICH WERE AUDITED AND ALSO PRODUCED DURING THE COURSE OF ASSESSMENT 7 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT PROCEEDINGS FOR VERIFICATION. THE LD ASSESSING OFFIC ER HAD NOT POINTED OUT ANY SPECIFIC DEFECT IN THE BOOKS OF ACCOUNT. THE ASS ESSEE IS A DOCTOR AND ALL THE PURCHASES HAVE BEEN CONSUMED IN THE OPERATI ONS AND WERE NOT MEANT FOR SALE. THE LD ASSESSING OFFICER HAD RECORDE D STATEMENT OF ONE OF THE ALLEGED BOGUS SUPPLIER M/S BHARGAVA HI TECH SUR GIMED PVT. LTD., JAIPUR, WHO HAD CONFIRMED THE GOODS SOLD TO THE ASSE SSEE. THE INSPECTORS REPORT CANNOT BE BASIS FOR MAKING ADDIT ION IGNORING ALL OTHER MATERIAL EVIDENCE AVAILABLE ON RECORD. MOREOVER, NO SUCH REPORT WAS EVER FURNISHED TO THE ASSESSEE DURING THE ASSESSMENT PRO CEEDINGS. IT IS MANDATORY ON THE PART OF THE ASSESSING OFFICER TO C ONFRONT THE MATERIAL PROCURED ON THE BACK OF THE ASSESSEE AS PER THE PRI NCIPLES OF NATURAL JUSTICE OTHERWISE IT CANNOT BE USED AGAINST IT, FOR WHICH HE RELIED ON THE DECISION IN THE CASE OF CIT VS PRADEEP KUMAR GUPTA 3 03 ITR 95 (DEL) AND CIT VS SMC SHARE-BROKERS LTD. 288 ITR 435 (DEL). ALT ERNATIVELY, THE AR OF THE ASSESSEE HAS ARGUED THAT THE ASSESSEE HAS BETTE R N.P. RATE IN THE YEAR UNDER CONSIDERATION COMPARED TO PRECEDING YEAR. IT IS NOT NECESSARY THAT IN EACH AND EVERY CASE, THE ADDITION IS NECESSARY A S HELD BY THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. GOT AN LIME KHANIJ UDYOG (2002) 256 ITR 243. HE FURTHER ARGUED THAT ON BOGUS PURCHASES, A REASONABLE PROFIT CAN BE ESTIMATED AS HELD BY THE H ONBLE ITAT, JAIPUR 8 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT BENCH IN THE CASE OF ANUJ KUMAR VARSHNEY & ORS. VS. ITO DECIDED ON 22/10/2014 WHEREIN 15% DISALLOWANCE HELD REASONABLE N.P. 5. AT THE OUTSET, THE LD DR HAS VEHEMENTLY SUPPORTE D THE ORDER OF THE LD CIT(A) AND ARGUED THAT THE LD ASSESSING OFFICER I SSUED SUMMONS TO THE SUPPLIERS. THE SUPPLIER PARTIES HAVE NOT RESPONDED. THE ASSESSEE IS ALSO NOT ABLE TO PRODUCE THE PARTIES FOR VERIFICATION, T HEREFORE, ORDER OF THE LD CIT(A) MAY PLEASE BE CONFIRMED. 6. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IT I S UNDISPUTED FACT THAT IN RESPONSE TO NOTICE U/S 131 OF THE ACT, BOTH THE PAR TIES WERE NOT RESPONDED AGAINST THE NOTICE OF THE ASSESSING OFFIC ER. THE ASSESSEE HAS DEBITED PURCHASES AS EXPENSE, THEREFORE, IT IS A BU RDEN CAST ON THE ASSESSEE TO PROVE THE EXPENSES INCURRED WHOLLY AND E XCLUSIVELY FOR THE BUSINESS PURPOSES U/S 37 OF THE ACT. THE ASSESSEE AL SO FILED VARIOUS EVIDENCES BEFORE THE LOWER AUTHORITIES AS WELL AS BEF ORE US, WHICH SHOWS THAT THE ASSESSEE HAD MADE PURCHASES FROM BOTH THE PARTIES AS THEY HAVE ALSO CHARGED VAT ALSO AND ALL THE PARTICULARS OF DRU G LICENSE NUMBER, SALES TAX REGISTRATION NUMBER AND ADDRESSES OF THE PARTIES HAD BEEN GIVEN ON THE BILLS. THEREFORE, IN THE INTEREST OF JUSTICE, WE FEEL THAT 15% NET 9 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT PROFIT IS TO BE APPLIED ON THE BOGUS PURCHASES MADE BY THE ASSESSEE. ACCORDINGLY, THIS GROUND OF ASSESSEES APPEAL IS PA RTLY ALLOWED. 7. THE 2 ND GROUND OF THE ASSESSEES APPEAL IS AGAINST DISALLO WANCE ON PURCHASE OF X-RAY FILMS. THE LD ASSESSING OFFICER OB SERVED THAT THE ASSESSEE HAD NOT PRODUCED ANY PURCHASE VOUCHERS FOR RS. 24,919/- FOR X- RAY FILMS. THUS, HE MADE ADDITION OF RS. 24,919/- IN THE INCOME OF THE ASSESSEE, WHICH WAS CHALLENGED BEFORE THE LD CIT(A), WH O HAD CONFIRMED THE ADDITION BY OBSERVING THAT THE ASSESSEE HAD FAI LED TO PROVE THE GENUINE INGREDIENTS OF SUCH EXPENSES FOR THE BUSINE SS PURPOSES EITHER DURING THE ASSESSMENT PROCEEDINGS OR DURING THE APP ELLATE PROCEEDINGS. INASMUCH AS, EVEN THE BASIC BILLS IN RESPECT OF SUC H PURCHASES HAD NOT BEEN PRODUCED. THE AR OF THE ASSESSEE REITERATED THE SAME ARGUMENT AS MADE FOR GROUND NO. 1 OF THE APPEAL. FURTHER IT IS CLAIMED B Y HIM THAT IN ABSENCE OF X-RAY FILMS, X-RAY MACHINE CANNOT BE USED. THE ASSES SEE HAS DISCLOSED INCOME FROM THE X-RAY MACHINE AND ALSO CLAIMED DEPR ECIATION ON IT, WHICH HAS BEEN ALLOWED BY THE DEPARTMENT. THEREFORE, THIS E XPENDITURE WAS GENUINE. THE LD DR HAS VEHEMENTLY SUPPORTED THE ORD ER OF THE LOWER AUTHORITIES. 10 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT BY CONSIDERING THE SMALLNESS OF AMOUNT OF PURCHASE OF X-RAY FILMS AND THE ASSESSING OFFICER ALLOWED THE DEPRECIATION O F X-RAY MACHINE, IT IS BUT NATURAL THAT THE ASSESSEE HAD PURCHASED X-RAY F ILMS. IT IS A FACT THAT EVEN BEFORE US, THE ASSESSEE HAS NOT FURNISHED ANY PURCHASE BILLS BUT IN THE INTEREST OF JUSTICE, WE ALLOW THE ASSESSEES APPE AL ON THIS GROUND. 8. THE 3 RD GROUND OF APPEAL IS AGAINST SUSTAINING THE ADDITIO N U/S 68 OF THE ACT AT RS. 59,700/-. THE LD ASSESSING OFFICER OB SERVED THAT THE ASSESSEE HAD SHOWN ADDITION U/S 68 OF THE ACT AT RS. 3,98,355/- FROM DIFFERENT PERSONS. THE ASSESSING OFFICER GAVE REASO NABLE OPPORTUNITY OF BEING HEARD TO PROVE THE IDENTITY OF CASH CREDITORS , GENUINENESS OF THE TRANSACTIONS AND CREDITWORTHINESS OF THE CREDITORS. HE ALSO ISSUED SUMMONS U/S 131 OF THE ACT, BUT WHICH CANNOT BE SERV ED ON DEVI DISTRIBUTORS & SURGICARE, KARNI ENTERPRISES, PRABHA T INFOTECH, SHREE JI ENTERPRISES AND SHREE LAXMI MEDICOSE. THUS THE ASSE SSING OFFICER MADE ADDITION OF RS. 3,98,355/- IN THE INCOME OF THE ASS ESSEE U/S 68 OF THE ACT, WHICH WAS CHALLENGED BY THE ASSESSEE BEFORE THE LD CI T(A) BUT THE LD CIT(A) FOUND CASH CREDITOR EXPLAINED IN CASE OF M/S BHARGAVA HI TECH SURGIMED CO. PVT. LTD.. IN CASE OF DEVI DISTRIBUTOR S AND SURGICARE AMOUNTING TO RS. 41,227/- AND M/S KARNI ENTERPRISES AMOUNTING TO RS. 11 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT 3,80,982/- HAD BEEN CONFIRMED BY THE LD CIT(A) AGAIN ST THE BOGUS PURCHASES, WHICH FOUND DOUBLE ADDITION BY THE LD CIT( A). IN CASE OF M/S PRABHAT INFOTECH, HE FOUND THE ASSESSING OFFICERS FINDING CONTRADICTORY, THEREFORE, HE ACCEPTED THE CASH CREDITOR AS GENUINE . IN CASE OF PURCHASE MADE FROM SHREE JI ENTERPRISES, WHICH WAS PERTAINED TO EARLIER YEAR, WHICH CANNOT BE ADDED DURING THE YEAR UNDER CONSIDER ATION. AS REGARDS THE REMAINING CREDITORS NAMELY M/S M.K. SURGICALS S UPPLIERS AMOUNTING TO RS. 22768/-, M/S RAJPUTANA BIOTECH PVT. LTD. AMOUNT ING TO RS. 1248/-, M/S SANTOSH BATTERY SERVICES AMOUNTING TO RS. 6,200 /-, M/S SHREE LAXMI MEDICOSE AMOUNTING TO RS. 4,345/- AND M/S SURGIMED AMOUNTING TO RS. 25,139/- TOTAL FOR RS. 59,700/-. THESE AMOUNTS WERE FOUND CREDITED IN THE BOOKS OF ACCOUNT DURING THE ASSESSMENT YEAR UNDER C ONSIDERATION AND NO PROPER EXPLANATION WAS FURNISHED WITH THE DOCUMENTARY EVIDENCE WITH REFERENCE TO SUCH CREDITS. THEREFORE, HE CONFIRMED T HE ADDITION. 9. THE LD AR OF THE ASSESSEE HAS CONTENDED THAT THE PROVISIONS OF SECTION 68 OF THE ACT HAD BEEN APPLIED TO THE PURCH ASE MADE ON CREDIT. SECTION 68 CAN BE APPLIED TO ANY SUM FOUND CREDITED IN THE BOOKS OF ACCOUNT, SOURCE OF WHICH CANNOT BE EXPLAINED BY THE APPELLANT, FOR WHICH HE RELIED ON THE DECISION OF THE HONBLE ALLAHABAD HIGH COURT IN THE CASE 12 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT OF CIT VS. PANCHAM DASS JAIN (2006) 205 CTR (ALL) 444 WHEREIN IT HAS BEEN HELD THAT THE PROVISIONS OF SECTION 68 WOULD NO T BE ATTRACTED ON THE PURCHASE MADE ON CREDIT. HE HAS FURTHER DRAWN OUR AT TENTION ON COPIES OF PURCHASE BILLS, CONFIRMATION AND COPY OF LEDGER ACC OUNT IN THE PAPER BOOK. THE LOWER AUTHORITIES ALSO IGNORED THE ASPECT OF HUMA N CONDUCT AND PROBABILITIES. IN THE CASE OF M/S SANTOSH BATTERY S ERVICE, THE TRANSACTION WAS RS. 6200/-, NO TRANSACTION WAS DONE DURING THE RE LEVANT YEAR, AMOUNT OUTSTANDING PERTAINED TO EARLIER YEAR. THEREF ORE, SAME CANNOT BE ADDED U/S 68. THE LD DR HAS VEHEMENTLY SUPPORTED THE ORDER OF THE LD CIT(A). AFTER CONSIDERING THE ARGUMENTS AND EVIDENCES FURN ISHED BY THE ASSESSEE AND CASE LAW RELIED BY THE AR, WE OBSERVE TH AT THE LOWER AUTHORITIES HAVE SHOWN THESE AMOUNTS AS CREDITED IN THE BOOKS OF ACCOUNT, NOWHERE, THE ASSESSEE CLAIMED THAT THESE AM OUNTS PERTAINED TO PURCHASE MADE BY THE ASSESSEE. THE SUMMONS ISSUED BY THE ASSESSING OFFICER BUT HAD NOT SERVED ON THE ASSESSEE. THE AR O F THE ASSESSEE HAS NOT CONTROVERTED THE FINDING GIVEN BY THE LD CIT(A). THE CASE LAW REFERRED BY THE ASSESSEE IS NOT APPLICABLE ON THE FACTS OF T HE CASE OF THE ASSESSEE. THUS, WE DISMISS THIS GROUND OF ASSESSEES APPEAL. 13 ITA NO. 181/JP/2015 DR. SITA RAM SHARMA VS ACIT 10. IN THE RESULT, THE ASSESSEES APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 12/02/2016. SD/- SD/- YFYR DQEKJ VH-VKJ-EHUK (LALIET KUMAR) (T.R. MEENA) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 12 TH FEBRUARY, 2016 RANJAN* VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- DR. SITA RAM SHARMA, CHOMU. 2. IZR;FKHZ @ THE RESPONDENT- THE ACIT, CIRCLE-7, JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 181/JP/2015) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR