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2016 (1) TMI 1312 - ITAT MUMBAIBogus purchases - unexplained expenditure - addition at the rate of 15% of the purchases made by the assessee from suspicious dealers whose names were listed in the website of the Sales Tax Department - not able to prove genuineness of the purchases- Held that:- Hon’ble Gujarat High Court in the case of “CIT vs. M.K. Brothers” (1985 (10) TMI 15 - GUJARAT High Court) has held that where there was nothing to indicate that the amount given by the assessee for the purchases made had come back to the assessee in any other form and where there was no evidence that the said concerns gave bogus vouchers to the assessee and even the statements made by the alleged suppliers in no way implicate the transaction with the assessee then under such circumstances it cannot be said that entries for the purchase of goods made in the books of account of the assessee were bogus and no addition in this respect can be made. As the transactions were supported with evidences and confirmations, in such an event merely because the suppliers whose names were listed in the list of suspicious dealers as provided in the official website of Sales Tax Department, Government of Maharashtra, who were allegedly providing accommodation entries without doing actual business and have not appeared before the AO or the Ld. CIT(A), one cannot conclude that the purchases were not genuine. Even when it is not the case of the Revenue that sales turnover of the assessee has decreased or the net profit ratio is less than the earlier assessment years or the subsequent assessment years, then, in our view, making addition on assumption that the assessee would have booked a lesser profit has no justification. No merit in the action of the lower authorities in making/sustaining the impugned additions and the same are accordingly ordered to be deleted. - Decided in favour of assessee.
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