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3. That case of the Assessing Officer that purchases in the month October 2016 have been made from RM Exports sister concern of the assessee and no expenses on account of freight, cartage and salary have been claimed is nothing but assumptions and presumptions since RM Exports sister concern of the assessee during the year under consideration was engaged in export business only and Indian sales were only on account of sale of export surplus and sale of semi finished material which was not upto mark for finished product for export. Profit and loss account of RM Exports for the year under consideration is enclosed at page no. 31 and 32 of the paper book. Perusal of the profit and loss account reveals that total sales of R.M. Exports amounted to Rs.41,81,06,498 out of which export sales amounted to Rs. 40,25,81,701 and Indian sales amounted to Rs. 1,55,23,797 only. Out of Indian sales of Rs. 1,55,23,797 sales of Rs. 49,56,248 have been made to assessee. Indian sales of R.M. Exports given above are mainly on account of sales of export surplus and sale of semi finished products which could not have resulted in finished products of export quality. These items were sold to assessee and assessee in turn has sold to the retail customers on cash basis. Observation of the Assessing Officer that there were no expenses on account of freight, cartage and salary, it is submitted that this issue was never raised during assessment proceedings otherwise assessee could have comfortably explained that there were no expenses since assessee was carrying on business in the adjoining building and M/s RM Exports supplied goods through their staff.

4. That observation of the Assessing Officer that no valid reasons for cash sales have been given when there has never been any history of cash sales has never been raised during assessment proceedings otherwise assessee could have comfortably explained that during this year only assessee purchased export surplus of M/s RM Exports and t he same was sold to retail customers on cash basis.

5. That as regards allegation of the Assessing Officer that cash sales have been introduced in books of accounts is an attempt on the part of the assessee to have cash in hand just before demonetization to cover cash deposited in bank during demonetization and further allegation of the Assessing Officer that purchases and sales have been affected in books of accounts in the month October 2016 upto 08.11.2016only because R.M. Sales Corporation v. ITO there was scope to manipulate books of accounts of October 2016 and upto 08.11.2016 because last date for filing VAT return for the month of September had passed at the time of announcement of demonetization of currency, it is submitted that both these allegations are based on assumptions and presumptions far away from the facts of the case. There is no material in possession of the Assessing Officer to justify allegations except assumptions only.