Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2020 (10) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (10) TMI 831 - AT - Income TaxEstimation of income - Bogus purchases - only reason for which AO doubted the genuineness of transaction was, the assessee could not produce the concerned parties - CIT-A estimated the suppressed profit at 12.5% of the alleged non–genuine purchases - HELD THAT:- Inability to produce the parties could be for various factors, including, their non–cooperation with the assessee. But, that by itself cannot be a reason to disallow the entire purchase by treating them as non–genuine. Assessee has furnished all documentary evidences including stock statement showing the consumption of material at site which were also submitted to bank from where the assessee is availing cash credit facility. The aforesaid fact clearly proves that the assessee, indeed, had purchased the goods and the goods have entered its stock and were utilized/consumed in the work. The doubt, if any, is only with regard to the source of purchases. In such circumstances, the entire purchases cannot disallowed. As rightly observed by Commissioner (Appeals), only the profit element embedded in such purchases can be considered for disallowance. Considering the nature of business carried on by the assessee, in our considered opinion, disallowance @ 12.5% of the alleged non–genuine purchases is fair and reasonable. Hence, needs to be upheld. - Revenue appeal dismissed.
|