Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2021 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (7) TMI 134 - AT - Income TaxEstimation of bogus purchases - HELD THAT:- Without purchases there cannot be processing of yarn, therefore, entire alleged bogus purchases cannot be disallowed. The possibility is that the assessee made purchases from grey market and obtained bogus purchase bills from hawala operators. It is only the profit element embedded in such transactions that has to be brought to tax. See PCIT vs. Paramshakhti Distributors Pvt. Ltd [2019 (7) TMI 838 - BOMBAY HIGH COURT] - assessee submitted that the G.P declared by the assessee in assessment year 2010-11 is 6.68%. However, on perusal of assessment order it is observed that the G.P has been worked out to be 8.12%. The same has not been disputed by the assessee either before the First Appellate Authority or the Tribunal. To meet ends of justice it would be fair to restrict disallowance on unproved purchases to 10%. Appeal by the assessee is partly allowed.
|