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2022 (6) TMI 967 - AT - Income TaxBogus purchases - estimated additions on the basis of GP rate in the past years of the assessee-company - HELD THAT:- The assessee, in the instant case, has declared a whopping turnover of Rs.1155.79 crore and also declared an income pegged in the vicinity of Rs.9.98 crore. The assessee therefore cannot be reckoned as anybody from the street. The amount of bogus purchases alleged is minuscule in the context of the voluminous business of the assessee. The documentation showing movement of goods towards impugned purchases also involves state government machinery as well as Central Excise Department. The purchases are carried out through banking channel and backed by documents showing movement and delivery thereof. Revenue has miserably failed to dislodge the sanctity of such formidable evidences in any manner except a statement of third person whose connection with the supplier has not been established. This apart, Shri Bhatia, i.e., witness has not been confronted to the assessee to unearth the truth. The assessee is entitled to cross-examine Shri Bhatia for a just and fair decision making. The Revenue has denied this valuable right and thus infringed the salutary principles despite request from the assessee before the lower authorities. Thus, the statement of Shri Bhatia is to be regarded as an extraneous to the determination of the issue. Once the statement of Shri Bhatia has excluded, the conclusion is obvious in the light of the documentary evidences towards its bona fides as claimed. Therefore, we find merit in the plea of the assessee for reversal of unjustified additions. Consequently, the order of the CIT(A) is set aside and the additions made towards bogus purchases are reversed. Appeal of assessee allowed.
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