COMMISSIONER OF INCOME TAX Vs. PRESTIGE FOODS LTD

JUDGEMENT

(1.) HEARD on the question of admission. The respondent-Company derives income from manufacture of Soyabeen oil. The assessing officer for the assessment year 1991-92, vide order of assessment dated 25.3.1994, found the claim of the respondent-Company in respect of purchase of Soya seed from M/s. Garg Traders to be bogus and held that there was no delivery of goods by the said party. The Commissioner of Income Tax (Appeals-I), Indore vide order dated 28.8.1999, had set aside the said finding of the assessing authority by holding that the purchases claimed by the respondent from the said party were not bogus. Accordingly the Commissioner deleted the addition of Rs.7,87,130/- made by the assessing authority on this account. The Income Tax Appellate Tribunal, vide order dated 27.11.2009, has affirmed the finding of the Commissioner.

(2.) LEARNED counsel appearing for the appellant submitted that the Tribunal has committed an error in taking the view that the purchases made by the respondent from the said party were not bogus. He further submitted that the tribunal is not right in holding that the assessee was not required to prove the source of purchase.

(3.) THE order of the Commissioner was challenged in appeal by the revenue before the ITAT. The Tribunal has reappreciated the entire circumstances and has affirmed the said finding. The Tribunal has rightly noted that the production of the assessee and the sales have not been doubted. The payments were made by the respondent to the said party through cheque and the delivery of goods was duly taken from the concerned traders. It was also noted that the assessee had adopted the proper procedure for receiving the goods supported by the gate-pass and goods were subject to lab testing, weighment etc. and they were duly recorded in the stock register. The payments were made by account payee cheque which were deposited in the Bank.