ITO,Ward-1(1), Hyderabad V. M/s Blaze Agritech (P) Limited, Secunderabad

ITA 967/HYD/2013

• Counselvise Citation: 96722514 RSA 2013
• Duration Of Justice: 1 year(s) 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 11-06-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: B RAMA KRISHNA
• Assessee Lawyers: S RAMA RAO
• Keywords: Unexplained cash credit; Business income; Corroborative evidences
• Section: 68; 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO. 967/HYD/2013 ASSESSMENT YEAR : 2005-06 INCOME-TAX OFFICER, WARD 1(1), HYDERABAD. M/S BLAZE AGRITECH (P) LTD., SECUNDERABAD PAN AABCB 9306 J (APPELLANT) (RESPONDENT) REVENUE BY SHRI B. RAMAKRISHNA ASSESSEE BY SHRI S. RAMA RAO DATE OF HEARING 13-10-2014 DATE OF PRONOUNCEMENT 22-10-2014 O R D E R PER SAKTIJIT DEY, J.M.: THIS IS AN APPEAL BY THE DEPARTMENT AGAINST THE OR DER DATED 21/02/2013 OF THE CIT(A)-V, HYDERABAD FOR THE ASSES SMENT YEAR 2005-06. 2. SOLITARY ISSUE IN THE APPEAL PREFERRED BY THE DE PARTMENT IS IN RESPECT OF DELETION BY CIT(A) OF AN ADDITION OF RS. 1,79,85,435 MADE BY AO U/S 68 OF THE ACT. 3. BRIEFLY THE FACTS ARE, ASSESSEE A COMPANY IS ENG AGED IN THE BUSINESS OF PURCHASE AND SALE OF PESTICIDES. FO R THE AY UNDER DISPUTE, ASSESSEE FILED ITS RETURN OF INCOME ON 30/10/05 DECLARING TOTAL INCOME OF RS. 9,35,676/-. DURING THE 2 ITA NO. 967/HYD/2013 M/S BLAZE AGRITECH (P) LTD. ASSESSMENT PROCEEDING, WHILE EXAMINING THE ACCOUNTS OF ASSESSEE, AO NOTICING CREDITS AGAINST CERTAIN CREDI TORS CALLED UPON THE ASSESSEE TO FURNISH LIST OF SUNDRY CREDITO RS ALONG WITH THE DETAILS OF THEIR PRESENT POSTAL ADDRESS, Q UANTITY AND VALUE OF GOODS SUPPLIED ALONG WITH CONFIRMATION LET TERS FROM THE CREDITORS. IN RESPONSE TO THE QUERY RAISED BY A O, ASSESSEE THOUGH FURNISHED DETAILS OF SUNDRY CREDITO RS ALONG WITH CONFIRMATION LETTERS, BUT, HE DID NOT FURNISH THE QUANTITY AND VALUE OF GOODS SUPPLIED BY EACH SUNDRY CREDITOR . AFTER VERIFYING THE DETAILS, AO NOTED THAT ASSESSEE HAS F URNISHED TWO DIFFERENT CONFIRMATIONS FROM M/S AGASTYA AGRO L TD, ONE OF WHICH IS FOR ITS HYDERABAD BRANCH ON AN AMOUNT OF R S. 1,79,85,435.48 AND THE OTHER ONE IS FOR KARNATAKA B RANCH FOR AN AMOUNT OF RS. 80,55,237.83. HE FURTHER NOTED THA T BOTH THE CONFIRMATION LETTERS WERE DATED 24/02/205 AND SIGNED BY SAME PERSON. AO FURTHER NOTED THAT THESE TWO CONFIR MATION LETTERS WERE PREPARED AND SIGNED BY MD OF THE COMP ANY. ON FURTHER ENQUIRY, AO FOUND THAT M/S AGASTYA AGRO LTD . IS ASSESSED IN THE SAME RANGE, BY ACIT, CIRCLE 1(1) AND IN THE SCRUTINY ASSESSMENT PROCEEDING IN CASE OF M/S AGAST YA AGRO LTD. AS PER THE INFORMATION SUBMITTED, IT WAS FOUND THE AMOUNT OUTSTANDING FROM M/S BLAZE AGRITECH P. LTD., I.E. THE PRESENT ASSESSEE WAS SHOWN AT RS. 80,55,239. APART FROM THE AFORESAID AMOUNT, NO OTHER AMOUNT WAS FOUND TO BE IN THE NAME OF M/S BLAZE AGRITECH P. LTD. AS ON 31/03/05. WHEREAS, ASSESSEE APART FROM RS. 80,55,239.05 HAS SHOWN A F URTHER AMOUNT OF RS. 1,79,85,435 AS CREDIT IN THE NAME OF M/S AGASTYA AGRO LTD. WHEN AO CALLED UPON THE ASSESSEE TO EXPLAIN THE DISCREPANCY, ASSESSEE IN ITS REPLY DATE D 12/09/07 SUBMITTED THAT IT HAS COMMITTED A MISTAKE IN FURNIS HING LIST OF CREDITORS AND CONFIRMATION LETTERS. FURTHER EXPLAIN ING, IT WAS 3 ITA NO. 967/HYD/2013 M/S BLAZE AGRITECH (P) LTD. SUBMITTED THAT WHILE THE CREDIT OF RS. 80,55,239 IS PERTAINING TO M/S AGASTYA AGRO LTD. WHEREAS THE AMOUNT OF RS. 1,79,85,435 EARLIER CLAIMED TO BE RELATING TO M/S A GASTYA AGRO LTD. WAS ACTUALLY DUE TO M/S SAINATHESWARA TRA DERS, HYDERGUDA FROM WHOM ASSESSEE HAS PURCHASED GOODS. I T WAS SUBMITTED THAT THOUGH SEPARATE ACCOUNT IN THE NAME OF M/S SAINATHESWARA TRADERS, HYDERGUDA IS MAINTAINED IN T HE BOOKS OF ACCOUNT OF ASSESSEE BUT BY MISTAKE THE SAME AMOU NT IS ALSO SHOWN AS DUE TO M/S AGASTYA AGRO LTD. IN THE L IST OF CREDITORS FURNISHED BEFORE AO. IT WAS SUBMITTED THA T AS THE LIST WAS SHOWING TWO AMOUNTS IN THE SAME ACCOUNT OF M/S AGASTYA AGRO LTD., ASSESSEE PREPARED LETTERS OF CO NFIRMATION ACCORDINGLY AND SENT THE SAME FOR THE SIGNATURE OF CREDITOR COMPANY M/S AGASTYA AGRO LTD. AND THE SAID COMPANY S OFFICIAL ALSO SIGNED BOTH THE CONFIRMATION LETTERS WITHOUT VERIFYING THE AMOUNTS. AS STATED BY AO IN THE ASSES SMENT ORDER, THOUGH, ASSESSEE WAS ASKED TO PRODUCE COMPLE TE ADDRESS OF M/S SAINATHESWARA TRADERS, HYDERGUDA, BU T, ASSESSEE DID NOT PROVIDE THE ADDRESS OF THE SAID PA RTY BY STATING THAT THE SAID PARTY HAS SUPPLIED GOODS DURI NG FY 2004-05 FROM HYDERGUDA PREMISES AND THE PRESENT LOC ATION IS NOT KNOWN. AS NOTED BY AO EVEN ON ENQUIRY NO PAN OF M/S SAINATHESWARA TRADERS, HYDERGUDA FROM THE DIRECTORY WAS AVAILABLE NOR ASSESSEE WAS ABLE TO TELL THE NAME OF THE PROPRIETOR OR PARTNER OF THE SAID CONCERN. FROM THI S, AO CAME TO A CONCLUSION THAT THE CREDIT OF RS. 1,79,85,435 REMAINED UNEXPLAINED AS ASSESSEE WAS NOT ABLE TO EITHER IDEN TIFY THE CREDITOR, GENUINENESS OF THE TRANSACTION OR CREDITW ORTHINESS OF THE CREDITOR. ACCORDINGLY, HE PROCEEDED TO COMPLETE THE ASSESSMENT BY TREATING THE AMOUNT OF RS. 1,79,85,43 5 AS 4 ITA NO. 967/HYD/2013 M/S BLAZE AGRITECH (P) LTD. UNEXPLAINED CASH CREDIT. BEING AGGRIEVED OF SUCH AD DITION MADE BY AO, ASSESSEE PREFERRED APPEAL BEFORE THE CI T(A). 4. BEFORE THE FIRST APPELLATE AUTHORITY, ASSESSEE C ONTENDED THAT IT HAS NOT ONLY EFFECTED PURCHASES FROM M/S SAINATHESWARA TRADERS, HYDERGUDA BUT HAS ALSO EFFEC TED SALES TO THEM. IT WAS SUBMITTED THAT THE AMOUNT DUE TO M/ S SAINATHESWARA TRADERS, HYDERGUDA WAS PAID IN THE SUBSEQUENT YEARS. IN SUPPORT OF SUCH CONTENTION, AS SESSEE SUBMITTED AN ACCOUNT COPY OF M/S SAINATHESWARA TRAD ERS, HYDERGUDA FOR THE SUBSEQUENT YEARS. AFTER CONSIDERI NG THE SUBMISSIONS OF ASSESSEE, CIT(A) CALLED FOR A REMAND REPORT FROM THE AO. AO IN HIS REPORT DATED 3/02/10, STATED THAT ALLEGED CHEQUE PAYMENTS CLAIMED TO HAVE BEEN MADE B Y ASSESSEE TO M/S SAINATHESWARA TRADERS, HYDERGUDA, O N VERIFICATION WERE FOUND TO HAVE BEEN PAID TO ONE MR . MANOJ KUMAR JAIN. AO, THEREFORE, COMMENTED THAT AS THE PA YMENTS WERE NOT MADE TO M/S SAINATHESWARA TRADERS, HYDERGU DA, ASSESSEES CLAIM CANNOT BE ACCEPTED. IN REPLY TO RE MAND REPORT SUBMITTED BY AO, IT WAS STATED BY ASSESSEE T HAT THE PAYMENTS WERE MADE THROUGH CROSSED-CHEQUES ON ACCOU NT OF AMOUNT DUE TO M/S SAINATHESWARA TRADERS, HYDERGUDA. IT WAS FURTHER SUBMITTED THAT AS M/S SAINATHESWARA TRADERS , HYDERGUDA HAS CLOSED ITS BUSINESS ACTIVITY, ASSESSE E WAS NOT IN A POSITION TO CONTACT THE PROPRIETOR OF THE SAID CONCERN. IT WAS FURTHER SUBMITTED IN SO FAR AS ASSESSEE IS CONC ERNED, IT MADE PAYMENTS TO M/S SAINATHESWARA TRADERS, HYDERGU DA AND THE PAYMENTS WERE ENCASHED BY SHRI MANOJ KUMAR JAIN. THE CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF ASS ESSEE AS WELL AS REMAND REPORT SUBMITTED BY AO, DELETED THE ADDITION BY HOLDING AS UNDER: 5 ITA NO. 967/HYD/2013 M/S BLAZE AGRITECH (P) LTD. 6.2 I FIND THAT THE ASSESSEE IS A TRADER IN FERTILI ZERS AND PESTICIDES. THE TOTAL SALES AMOUNTED TO RS. 9,66,29,666/- AND THE PURCHASES AMOUNTED TO RS. 8,98,29,186/-. THE PURCHASES MADE INCLUDE THE PURCHASES AFFECTED FROM SAINATHESWARA TRADERS AND, THEREFORE, ARE PURCHASES FROM THE SAID CONCERN. FRO M THE ACCOUNT COPY OF SAINATHESWARA TRADERS IN THE BO OKS OF THE APPELLANT FIRM, IT IS SEEN THAT THE PURCHASE S MADE FROM THE SAID CONCERN ARE CREDITED TO ITS ACCOUNT A ND THE PAYMENTS MADE WERE DEBITED. THE AMOUNTS WERE PAID THROUGH CHEQUES UPTO JUNE, 2007 TILL THE BALANCE WA S REDUCED TO NIL. THE AO VERIFIED ALL THE CHEQUES ISS UED BUT FOUND ONLY FEW, THE AGGREGATE VALUE OF WHICH AMOUNTS TO RS. 1,93,467/- CREDITED TO HIS BANK ACCO UNT WITH STATE BANK OF HYDERABAD, BOWENPALLY AND RS. 1,85,000/- CREDITED TO THE BANK ACCOUNT WITH AP MAH ESH CO-OP. URBAN BANK LTD. EXCEPT THESE CHEQUES TOTALIN G TO RS. 3,78,467/-, ALL THE CHEQUES WERE CREDITED TO TH E ACCOUNT OF SAINATHESWERA TRADERS. THE LEARNED AR CONTENDED THAT THE CHEQUES WERE ISSUED IN FAVOUR OF SRI MANOJ KUMAR JAIN AT THE INSTRUCTIONS OF SAINATHESWE RA TRADERS. FROM THE ABOVE IT IS CLEAR THAT: 1) THERE WERE PURCHASES FROM SAINATHESWERA TRADERS 2) THERE WAS CLOSING CREDIT BALANCE AT THE END OF T HE PREVIOUS YEAR 3) THERE IS A MISTAKE IN THE SUBMISSION OF THE DETA ILS OF SUNDRY CREDITORS AND 4) THE AMOUNTS TO THE CREDIT WERE PAID THROUGH CHEQ UES IN THE LATER YEARS. 6.3 ALL THESE FACTORS INDICATE THAT THE PURCHASES E FFECT FROM SAINATHESWERA TRADERS IS NOT IN DOUBT. TAKING ALL THE FACTORS INTO ACCOUNT, I AM OF THE VIEW THAT THE CREDITS CANNOT BE TREATED AS UNEXPLAINED. ACCORDING LY, THE AO DIRECTED TO DELETE THE ADDITION. 5. THE LEARNED DR SUBMITTED BEFORE US THAT AT THE T IME OF ASSESSMENT PROCEEDING, ASSESSEE HAS NOT PRODUCED AN Y EVIDENCE TO PROVE THE CREDITS IN THE NAME OF M/S SAINATHESWARA TRADERS, HYDERGUDA. IT WAS SUBMITTED THAT EVEN DURING REMAND ALSO, ASSESSEE HAS NOT BEEN ABL E TO PROVE THAT THE CREDITS WERE ACTUALLY RELATING TO M/ S 6 ITA NO. 967/HYD/2013 M/S BLAZE AGRITECH (P) LTD. SAINATHESWARA TRADERS. IT WAS SUBMITTED THAT NEITHE R ANY CONFIRMATION FROM THE SAID PARTY WAS FURNISHED NOR ANY OTHER DETAILS TO PROVE THE FACT THAT THE AMOUNT WAS OUTST ANDING IN THE NAME OF M/S SAINATHESWARA TRADERS, HYDERGUDA WA S PRODUCED. IT WAS SUBMITTED THAT THOUGH ASSESSEE CLA IMED THAT IT HAS PURCHASED GOODS FROM M/S SAINATHESWARA TRADE RS, HYDERGUDA DURING THE YEAR AND ALSO SOLD GOODS DURIN G THE SUBSEQUENT YEAR, BUT, HE HAS NOT BEEN ABLE TO SUBST ANTIATE THE SAME WITH SUPPORTING EVIDENCE. HE SUBMITTED THA T IN ABSENCE OF ANY CORROBORATIVE EVIDENCE TO PROVE THE CREDIT OF RS. 1,79,85,435, THE CIT(A) WAS NOT JUSTIFIED IN DE LETING THE ADDITION MADE BY AO. 6. THE LEARNED AR, ON THE OTHER HAND, SUBMITTED THA T BEFORE THE AO ITSELF ASSESSEE HAS EXPLAINED THAT BY MISTAKE IT HAS CLAIMED THE AMOUNT OF RS. 1,79,85,435 TO BE DUE TO M/S AGASTYA AGRO LTD, HOWEVER, SUBSEQUENTLY, BEING AWAR E OF THE MISTAKE COMMITTED, IT HAS SUBMITTED BEFORE AO THAT ACTUALLY THE AMOUNT WAS DUE TO M/S SAINATHESWARA TRADERS, HYDERGUDA FROM WHOM ASSESSEE PURCHASED GOODS DURING THE RELEVANT PY. IT WAS FURTHER SUBMITTED THAT ASSESSEE HAS EVEN SOLD GOODS TO THE SAID PARTY DURING THE SUBSEQUENT YEAR. IN THIS CONTEXT, LEARNED AR REFERRED TO THE REPLY SUBM ITTED BEFORE THE AO ON 26/11/07, A COPY OF WHICH IS PLACE D AT PAGE 17 OF ASSESSEES PAPER BOOK. LEARNED AR SUBMITTED T HAT AS AO HAS NOT TREATED THE PURCHASES AS BOGUS AND ACCE PTED THE GROSS PROFIT THERE IS NO REASON WHY ASSESSEES EXPL ANATION REGARDING CREDIT OF RS. 1,79,85,435/ SHOULD NOT BE ACCEPTED. LEARNED AR SUBMITTED THAT CIT(A) HAVING EXAMINED TH E FACTS RELATING TO TRANSACTION WITH M/S SAINATHESWARA TRAD ERS, 7 ITA NO. 967/HYD/2013 M/S BLAZE AGRITECH (P) LTD. HYDERGUDA AND FOUND IT TO BE GENUINE, HAS DELETED T HE ADDITION. 7. WE HAVE CONSIDERED THE SUBMISSIONS OF THE PARTIE S AND PERUSED THE ORDERS OF THE REVENUE AUTHORITIES AS WE LL AS OTHER MATERIALS ON RECORD. AS CAN BE SEEN FROM THE FACTS AND MATERIALS ON RECORD, IN COURSE OF ASSESSMENT PROCEE DING WHEN AO CALLED UPON ASSESSEE TO FURNISH THE DETAILS OF T HE CREDITS APPEARING IN THE BOOKS OF ACCOUNT, ASSESSEE SHOWN T HE AMOUNTS OF RS. 80,55,239 AND RS. 1,79,85,435 RELAT ING TO M/S AGASTYA AGRO LTD AND ALSO FURNISHED TWO CONFIRM ATION LETTERS FOR THE AFORESAID AMOUNTS FROM M/S AGASTYA AGRO LTD. HOWEVER, WHEN THE AO CROSS VERIFIED WITH THE ASSESS MENT RECORDS OF M/S AGASTYA AGRO LTD FOR THE RELEVANT AY , HE FOUND THAT ONLY AN AMOUNT OF RS. 80,55,239 WAS OUTSTANDIN G FROM ASSESSEE TO M/S AGASTYA AGRO LTD. WHEN THIS FACT WA S POINTED OUT TO ASSESSEE, HE CAME UP WITH A PLEA THAT AMOUN T OF RS. 1,79,85,435 WAS ACTUALLY DUE TO M/S SAINATHESWARA T RADERS, HYDERGUDA AND NOT TO M/S AGASTYA AGRO LTD., WHICH W AS MISTAKENLY SHOWN AS CREDITOR. HOWEVER, ON PERUSAL O F THE ASSESSMENT ORDER, IT IS PATENT AND OBVIOUS THAT ASS ESSEE HAS NEITHER PRODUCED ANY CONFIRMATION LETTER NOR FURNIS HED ANY DETAILS IN RESPECT OF M/S SAINATHESWARA TRADERS, HY DERGUDA INDICATING ITS PRESENT ADDRESS, NAME OF ITS PROPRIE TOR/PARTNERS AND CONTACT DETAILS LIKE TELEPHONE NOS. ETC. EVEN P AN OF THE SAID CONCERN WAS NOT FURNISHED BEFORE AO. FROM THE AFORESAID FACTS, IT IS CLEAR THAT IN COURSE OF ASSESSMENT PRO CEEDING, ASSESSEE FAILED TO ESTABLISH THE CASH CREDIT BY IDE NTIFYING THE CREDITOR, PROVING THE CREDITWORTHINESS AS WELL AS T HE GENUINENESS OF THE TRANSACTION. HOWEVER, DURING TH E PROCEEDING BEFORE THE FIRST APPELLATE AUTHORITY, AS SESSEE HAS 8 ITA NO. 967/HYD/2013 M/S BLAZE AGRITECH (P) LTD. CLAIMED TO HAVE FILED THE DETAILS OF PAYMENTS MADE SUBSEQUENTLY TO M/S SAINATHESWARA TRADERS, HYDERGUD A THROUGH CROSSED-CHEQUE. AS CAN BE SEEN FROM THE REM AND REPORT DATED 03/02/10, COPY OF WHICH IS PLACED AT P AGE 11 OF ASSESSEES PAPER BOOK, AO ON EXAMINING FEW PAYMENT DETAILS FOUND THEM TO HAVE BEEN MADE TO ONE MR. MANOJ KUMAR JAIN. HOWEVER, EVEN BEFORE THE FIRST APPELLATE AUTHORITY ALSO, ASSESSEE DID NOT PRODUCE ANY CORROBORATIVE EVIDENCE TO CONCLUSIVELY PROVE THAT THE CREDITS WERE RELATING T O M/S SAINATHESWARA TRADERS, HYDERGUDA WITH WHOM ASSESSEE CLAIMED TO HAVE BUSINESS TRANSACTIONS OF PURCHASE A ND SALE OF PESTICIDES. HOWEVER, LEARNED CIT(A) ACCEPTED ASSESS EES CLAIM ON MERE FACE VALUE WITHOUT SUPPORTING EVIDEN CE ONLY ON THE REASON THAT ASSESSEE HAS MADE PAYMENTS THROU GH CROSSED-CHEQUES TO M/S SAINATHESWARA TRADERS, HYDER GUDA, WHICH PROVES THE FACT OF TRANSACTION BEING CARRIED OUT BY ASSESSEE WITH THAT PARTY. WHILE COMING TO SUCH CONC LUSION THOUGH THE LEARNED CIT(A) HAS OBSERVED THAT AO HAS VERIFIED ALL THE CHEQUES AND FOUND THAT EXCEPT AN AMOUNT OF RS. 3,78,467 REST OF THE AMOUNT IS CREDITED TO THE ACCO UNT OF M/S SAINATHESWAR TRADERS, HOWEVER, ON PERUSAL OF THE RE MAND REPORT DATED 03/02/2010 OF AO, A COPY OF WHICH IS A T PAGE 11 OF PAPER BOOK, WE DO NOT FIND ANY SUCH OBSERVATION. IN OUR VIEW, THE CONCLUSION DRAWN BY CIT(A) IS NOT CORRECT . IT IS A FACT ON RECORD THAT ASSESSEE APART FROM SUBMITTING THAT IT HAS ENTERED INTO PURCHASE AND SALE TRANSACTION WITH M/S SAINATHESWARA TRADERS, HYDERGUDA HAS FAILED TO PROD UCE ANY CORROBORATIVE EVIDENCE TO PROVE EITHER THE EXISTENC E OF M/S SAINATHESWARA TRADERS, HYDERGUDA OR THE FACT THAT MR. MANOJ KUMAR JAIN IS EITHER PROPRIETOR OR PARTNER OF THE S AID CONCERN OR IN ANY WAY RELATED TO M/S SAINATHESWARA TRADERS, 9 ITA NO. 967/HYD/2013 M/S BLAZE AGRITECH (P) LTD. HYDERGUDA. THERE IS ALSO NO DOCUMENTARY EVIDENCE T O SHOW THAT PAYMENTS MADE TO MR. MANOJ KUMAR JAIN IS AT TH E INSTRUCTION OF M/S SAINATHESWAR TRADERS. IN FACT, N O BILLS AND VOUCHERS HAVE BEEN PRODUCED TO PROVE EITHER THE PUR CHASE FROM M/S SAINATHESWARA TRADERS, HYDERGUDA OR SALE T O THEM. IF AS PER THE VERSION OF ASSESSEE TRANSACTIONS CONT INUED TILL JUNE, 2007, IT IS HIGHLY IMPROBABLE THAT ASSESSEE W OULD NOT BE HAVING ANY DETAILS OF M/S SAINATHESWARA TRADERS, HYDERGUDA LIKE ITS TELEPHONE NO. OR ANY OTHER DETAI LS TO ESTABLISH ITS IDENTITY. EVEN THE ASSESSEE HAS NOT P RODUCED THE QUANTITATIVE DETAILS OF PURCHASE AND SALES EFFECTED BY IT DURING THE YEAR. IN THESE CIRCUMSTANCES ON WHAT BAS IS, THE CIT(A) HAS COME TO THE CONCLUSION THAT ASSESSEE HAS EFFECTED PURCHASES FROM M/S SAINATHESWARA TRADERS, HYDERGUDA IS NOT UNDERSTOOD. IN THE AFORESAID VIEW OF THE MATTER, WE ARE NOT ABLE TO ACCEPT THE CONCLUSION DRAWN BY CIT(A) AS IT IS WITHOUT PROPER APPRECIATION OF FACTS AND EVIDENCES. HOWEVER , CONSIDERING THE NATURE OF ADDITION AND ALSO ASSESSE ES SUBMISSION THAT IT HAS ENTERED INTO BUSINESS TRANSA CTIONS WITH M/S SAINATHESWARA TRADERS, HYDERGUDA FOR PURCHASING AND SELLING PESTICIDES, WE ARE INCLINED TO SET ASIDE TH E IMPUGNED ORDER OF LEARNED CIT(A) AND REMIT THE MATTER BACK T O THE FILE OF THE AO TO GRANT ANOTHER OPPORTUNITY TO ASSESSEE TO ESTABLISH ITS CASE BY PRODUCING CORROBORATIVE EVIDE NCE. FURTHER, CONSIDERING ASSESSEES CLAIM THAT PAYMENTS WERE MADE THROUGH CROSSED CHEQUES, NECESSARY ENQUIRY CAN BE CONDUCTED WITH THE CONCERNED BANKS TO ASCERTAIN THE CORRECT FACT. THE ASSESSEE ON ITS PART CAN ALSO PRODUCE CON FIRMATION LETTERS EITHER FROM M/S SAINATHESWARA TRADERS, HYDE RGUDA OR FROM MANOJ KUMAR JAIN AND ANY OTHER CORROBORATIVE E VIDENCE TO SUBSTANTIATE ITS CLAIM. THE AO MUST AFFORD FAIR OPPORTUNITY 10 ITA NO. 967/HYD/2013 M/S BLAZE AGRITECH (P) LTD. TO ASSESSEE TO SUBSTANTIATE ITS CLAIM AND THEN DECI DE THE ISSUE AFTER CONSIDERING ALL FACTS AND MATERIALS ON RECORD AND IN ACCORDANCE WITH LAW. 8. IN THE RESULT, APPEAL OF REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 22 ND OCTOBER14. SD/- SD/- (P.M. JAGTAP) (S AKTIJIT DEY) ACCOUNTANT MEMBER JU DICIAL MEMBER HYDERABAD, DATED: 22 ND OCTOBER, 2014 KV COPY TO:- 1) ITO, WARD 1(1), HYDERABAD. 2) M/S BLAZE AGRITECH(P) LTD., PLOT NO. 39 & 40, I IIRD FLOOR, CHITTAREDDY COLON, TADBUND X ROAD, SECUNDERABAD 5 00 009.. 3) CIT(A)-V, HYDERABAD 4) CIT-IV, HYDERABAD 5)THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDER ABAD.