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2017 (3) TMI 1230 - ITAT MUMBAIAddition under section 69C - Held that:- We find that out of total purchases, the AO could not verify the purchases to the extent of ₹ 49,74,252/- when the notice under section 133(6) of the Act were issued which were returned un-served. We also find that the assessee could not produce any stock tally of the total purchases and sales made during the year and stocks left unsold at the year end. But the AO has not doubted the sales made during the course of assessment proceedings. The ld.CIT(A) has recorded the findings of facts that the assessee has not discharged the burden cast upon it including proving the genuineness of the transactions. CIT(A) also observed that the AO has also failed to discharge the responsibility cast upon under the Act. The AO has not disputed the books of accounts including the sales nor did verify or investigate the amount paid by way of cheques whether received by the appellant back from the purchasers. In our opinion, the ld.CIT(A) has rightly sustained the addition to the extent of 12% of the total purchases covering the leakages of revenue and also the possibility of savings which the assessee may have made by making purchases from gray market by not paying the regular and legal taxes of local bodies.- Decided against revenue
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