D28, South Extension, PartI New Delhi New Delhi PAN : AAACM1960G (Appellant) (Respondent) Appellant by : Dr. Rakesh Kupta, Sh. Somil Aggarwal, Advs. Respondent by : Sh. N. K. Bansal, Sr.DR Date of hearing : 21.03.2017 Date of pronouncement : 24.03.2017 ORDER PER BEENA A. PILLAI, J.M : 1. The present appeal has been preferred by assessee against order, dated 30.09.2013 passed by Ld. CIT(A)XXXII for assessment year 200405 on following grounds of appeal: 1. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in framing the impugned order u/s 147/143(3) and that too without assuming jurisdiction as per law and without complying with mandatory conditions as envisaged u/s 147 to 151 of Income Tax Act, 1961 and impugned order has been passed that too without recording valid reasons and without obtaining valid sanction as per law. 2 ITA No. 6253/Del/2013 (AY 200405) 2. That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in framing the impugned assessment u/s 147/143(3) is bad in law and against the facts and circumstances of the case. 3. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in making disallowance of Rs.52,50,000/ on account of purchases of PGSM Software Module from M/s B.T. Technet Ltd. by treating the same as nongenuine and that too without independent application of mind and by recording incorrect facts and findings and without providing opportunity of cross examination. 4. That in any case and in any view of the matter, impugned disallowance and impugned assessment order are bad in law, illegal, unjustified, contrary to facts & law and based upon recording of incorrect facts and finding, without giving adequate opportunity of hearing, in violation of principles of natural justice and the same deserves to be quashed. 5. That the appellant craves to leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other. 2. The brief facts of the case are as under: Assessee filed its original return of income on 01.11.2004 declaring total income of Rs.18,91,694/. Assessing officer framed assessment under section 143(3) on 22.12.2006 and assessed total income at Rs.25,99,300/ in hands of assessee. Aggrieved by assessment order, assessee preferred appeal before Ld. CIT(A), who reduced the assessed income to Rs. 19, 91, 990/. 3 ITA No. 6253/Del/2013 (AY 200405) In the meantime a search and seizure action took place at S.K. Gupta Group. Ld. AO records that during the course of search at 231, Gulmohar Enclave, one of the premises of Sh. SK Gupta, large number of incriminating documents were found. These documents included sale bills issued by M/s BT Technet Ltd., one of the companies of Sh. S.K. Gupta, to whom assessee had transaction for purchase of 'PGSM Software' worth Rs.52,50,000/ during year under consideration. It has been observed by Ld. AO that such bills of sales of PGSM Software to assessee were found pertaining to year under consideration from searched premises. Accordingly, jurisdiction over the case was transferred to circle. It has been recorded by Ld. AO that while concluding assessment proceedings of M/s BT Technet Ltd., it was proved on the basis of confessional statement of Sh. S.K. Gupta husband of Smt. Saroja Gupta, who was Director of M/s BT Technet Ltd., t