A. P. Fashion Pvt. Ltd. Vs Pr. CIT (Central)-2) (ITAT Kolkata)
ITAT Kolkata held that treating purchases from concern as bogus merely because for another year purchases from the said concern were treated by AO as bogus is not justified since in relevant year AO duly treated the purchases as genuine.
Facts- Post survey action and addition towards bogus purchases, PCIT exercising his revisional jurisdiction u/s.263 of the Act observed that for the year under consideration, the assessee had also shown purchases of Rs.84,41,255/- from Afterlink Vinimay Pvt. Ltd. and that the said company has been noted by the AO as shell company providing bogus billing in respect to purchases made for FY 20 17-18. He, therefore, held that the AO was also supposed to hold the purchases made by the assessee from AVPL for the year under consideration as bogus. He, therefore, exercising his revisional jurisdiction u/s.263 of the Act set aside the assessment order passed u/s. 147 of the Act and directed the AO to make necessary verification/inquiry on the aforesaid issue and pass a fresh assessment order.
Conclusion- Held that AO has duly examined the records and treated the aforesaid purchases as genuine. Merely because, for another year the purchases made by the assessee from the said concern AVPL have been treated by the AO as bogus, that in itself, in our view, cannot be made the sole basis to treat the purchases made by the assessee from the said concern for the year under consideration as bogus. Therefore, the revision order passed by the Ld. Pr. CIT is not sustainable and the same is accordingly, quashed. However, it is made clear that our observation made in this order will not have any bearing relating to the validity of the purchase/additions made by the AO in respect of the purchases made from other parties or from the same party in an another assessment year. The validity of the same will be examined in the respective assessment/appellate proceedings and the finding, given herein, will not have any bearing upon the same. With the above observation, the appeal of the assessee is treated as allowed.
