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2020 (4) TMI 220 - AT - Income TaxDisallowance of bogus purchases - Addition @ 12.5% of the aggregate of disputed purchases - HELD THAT:- CIT(A) affirmed the action of AO holding that disallowance of 12.5% in the business of wholesale trading of electronic items such as computer parties, accessorises, print cartridges and Sony tapes are rational and justified. We have noted that before us the assessee has not filed even a single document to substantiate his contention. We are conscious of the fact that under the income tax proceeding only tax can be levied on the income component and not on the entire transaction. Even the entire transaction are not verifiable the lower authorities are entitled to tax the income component of transaction only. We have noted that lower authorities have made the disallowance keeping in view the nature and business activities of the assessee and disallowed 12.5% of the tainted purchases. In our view, the Assessing Officer has made a reasonable disallowance, which does not require any interference at our end - Appeal of the assessee is dismissed.
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