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2016 (2) TMI 1204 - GUJARAT HIGH COURTBogus purchases - purchases from grey market - Held that:- AO without rejecting the books of account of the assessee for the year under consideration has observed that the genuineness of the purchases is not established and has made the addition whereas the Tribunal has proceeded on the footing that the AO has recognised the purchases made by the assessee and the question is not of quantitative details. Tribunal has also observed that the AO has accepted the sales made by the assessee and if that be so, it would indicate that the assessee must have made purchases, otherwise it would not be possible for the assessee to make the sales. Thus, even as regards the basic facts, the Tribunal has proceeded on an erroneous footing. As regards the cheque issued in favour of A.K. Textile which is withdrawn by the proprietor of A.K. Textile named "Aaisha" a perusal of the table at paragraph 4 of the assessment order shows that an amount of ₹ 50140/- has been withdrawn in cash in respect of cheque No.446893 and an amount of ₹ 52451/- has been withdrawn in cash in respect of cheque No.446894 and the assessee in his reply has clearly admitted that payment was made in cash and has stated that 20% thereof be disallowed. However, the same has been totally disregarded by the AO as well as the Tribunal. The court is of the view that the Tribunal while passing the impugned order has lost sight of the directions contained in its previous order and has recorded findings which are not in consonance with the record of the case and are, therefore, perverse. The impugned order of the Tribunal which suffers from various infirmities as noted hereinabove, therefore, cannot be sustained. - Decided against the revenue.
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