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2019 (11) TMI 323 - AT - Income TaxAddition on account of non–genuine purchases - addition @ 12.5% of the non–genuine purchases - HELD THAT:- The facts on record reveal that before the Departmental Authorities, the assessee has not been able to conclusively prove genuineness of purchases. Even, attempt made by the AO to independently verify the purchases bore no result. In such circumstances, assessee’s claim of purchases made being genuine cannot be accepted. The fact that the assessee had furnished quantitative details relating to purchase, consumption and sale of goods cannot be completely overlooked. Thus, a reasonable presumption can be drawn that the assessee may not have purchased the goods from the declared source but has purchased them from third parties and for regularizing such purchases has obtained accommodation bills. In such circumstances, the entire purchases made by the assessee cannot be disallowed and added back to the income of the assessee. It would be reasonable to estimate the profit element embedded in such purchases and consider it for addition. Addition @ 12.5% of the non–genuine purchases would be reasonable. Accordingly, direct the Assessing Officer to restrict the addition to 12.5% of ₹ 11,66,082. Assessee’s appeal is partly allowed.
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