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2017 (8) TMI 1319 - AT - Income TaxAddition on account of bogus/fictitious purchases - profit rate determination - Held that:- Considering the facts in totality AO held that the assessee had not made any purchases from these parties and therefore, the transactions were bogus, and even otherwise the Bench of the ITAT, prima facie found that purchase record in the books of accounts were bogus with a view to suppress the profit and therefore, while considering their opinion as the same would be just and proper to apply net profit rate of 5% on the goods sold but while coming to the instant case it is clear that in the instant case the purchases have been confirmed through vouchers and stock tallied properly and sale of the assessee also not been doubted and even otherwise the profit earned by the assessee has already been subjected to the tax, and the Revenue Department failed to bring any circumstance/material to establish that the addition can be restricted to 5% of the bogus purchases and/or even otherwise the transactions carried by the assessee are bogus purchases, hence, in our considered opinion we do not found any substantive reason and logic in sustaining addition @5% on account of bogus purchases. Hence, the same is deleted.
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