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2018 (2) TMI 964 - AT - Income TaxAddition on account of bogus purchases - purchases made from non - genuine parties - Held that:- The assessee is not a wholesale trader of steel, but is a manufacturer of steel items. It had purchased and used steel from the parties, who have not issued bills. PKS and others from whom the assessee has claimed to have purchased steel, had not supplied goods to it. But consumption of steel has not been questioned-rather sales have been accepted as it is. Unlike the matter of Bholanath Poly Fab (2013 (10) TMI 933 - GUJARAT HIGH COURT) it is not a case where the cheque issued by the assessee have been encashed by unknown persons. At least the AO has not alleged that. It is a case of purchases made from non - genuine parties and not a case of bogus purchases. The FAA had adopted a formula to determine possible profit out of purchases made from unknown suppliers. There is no legal or factual infirmity in her order. No hard and fast rules can be applied in such cases. The rate of profit would vary from business to business and case to case. So, we are not interested in interfering with her order. Confirming the same, we decide first ground of appeal against the AO. Addition on account of commission expenses - Held that:- FAA had rightly held that no ad hoc disallowance can be made without relying upon any cogent material. Confirming her order, we dismiss second ground, raised by the AO. Disallowance u/s 14A - time limit for issue of notice under section 143(2) - Held that:- The original return for the year under consideration was filed on 30/09/2009, the time limit for issue of notice under section 143 (2) was six months from the end of the financial year in which the return was filed, that the search took place on 29/04/2011, that time limit for issue of notice at expired on the date of initial of search, that the assessment for the year under appeal could not be said to be pending or abated, that the impugned order did not reflect that any material emanating from the search led to the disallowance, made by the AO, under section 14A. See All Cargo Global Logistics Ltd [2017 (6) TMI 309 - BOMBAY HIGH COURT] - Decided in favour of assessee.
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