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2021 (9) TMI 1161 - AT - Income TaxEstimation of income - Bogus purchases - GP rate determination - HELD THAT:- Addition in respect of the purchases made by the assessee from the open/grey market is backed by the reason that the goods in question would have been procured at a discounted value as against that accounted for on the basis of bogus purchase bills in the books of accounts. We, thus, in terms of our aforesaid deliberations herein direct the A.O to restrict the addition insofar the bogus/unproved purchases aggregating to ₹ 93,93,627/- in the case before us are concerned by bringing the G.P. rate on the amount of such bogus purchases at the same rate as that of the other similarly placed genuine purchases. Validity of the reopening of the assessment u/s 147 - eligibility of reason to believe - bogus purchases - HELD THAT:- A.O after referring to the material i.e the information that was received by him from the Investigation wing, Mumbai, had therein clearly applied his mind and had observed that as per the information as the assessee company was one of the beneficiary qua the purchases made from the hawala parties, therefore, he had a ‘reason to believe’ that on account of claim of excessive expenses on account of purchases claimed by the assessee to have been made from the said hawala dealers, its income for the year under consideration had been under assessed. We are unable to persuade ourselves to subscribe to the claim of the ld. A.R that the concluded assessment of the assessee had been reopened on the basis of a borrowed satisfaction. As observed by us hereinabove, the A.O in the backdrop of the information that was received by him from the Investigation wing, Mumbai had after due application of mind validly reopened the case of the assessee. Accordingly, finding no infirmity in the validity of the reopening of the assessee’s case u/s 147 - Decided against assessee.
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