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Shri Anil Gupta Versus The ITO, Ward- 1 (3) , Jaipur

2015 (10) TMI 2420 - ITAT JAIPUR

Unverifiable purchases - Rejection of books of account - purchases made by the appellant are not genuine and are not verifiable - trading addition - Held that:- In view of the decision of this Coordinate Bench in the case of Anuj Kumar Varshney vs. ITO and others Gems and Jewellery cases [2015 (4) TMI 533 - ITAT JAIPUR] addition is restricted to 15% of unverifiable purchases which will be worked out by AO accordingly. - Decided in favour of assessee in part. - ITA No. 281/JP/2014 - Dated:- 24-9- .....

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appellant by the AO on the ground that purchases of ₹ 14,30,963/- made by the appellant are not genuine and are not verifiable. 2. That the ld. CIT(A) is further wrong and has erred in confirming trading addition of ₹ 3,57,741/- made by the AO on account of alleged unverifiable purchases referred to in Ground No. 1() above. 2.1 Brief facts of the case are that the assessee is a partnership firm and has filed the return of income on 30-09-2009 declaring total income of ₹ 9,99,8 .....

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ofit rate 2007-08 560.99 63.65 11.35% 2008-09 746.87 83.77 11.22% 2009-10 660.36 54.19 08.21% The AO observed that the assessee has shown less sales and gross profit as compared to earlier years. The AO observed that the assessee had made purchases from two parties namely M/s. Gems Ocean for ₹ 4,73,501/- and M/s. Sanchi Impex for ₹ 9,57,462/- totaling to ₹ 14,30,964/-. During the course of assessment proceedings, the AO observed that these above parties have been earlier declar .....

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n the case of Sanjay Oil Cake Industries vs. CIT (2008) 10 DTR 153 and ITAT Ahemdabad decision in the case of Vijay Proteins Ltd. 58 ITD 428. 2.2 Being aggrieved by the order of the AO, the assessee carried the matter before the ld. CIT(A) who has dismissed the appeal of the assessee by following observations. 4.1 I have considered submissions of the appellant and have also gone through the assessment order. It is noted that the AO has rejected the books of account on the ground that purchases f .....

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that the disallowance of 25% of purchases on the basis of Sanjay Oil Cake (supra) is not correct as the facts of the case are different. As held by Hon'ble ITAT, Jaipur Bench in the case of Gems Paradise (supra), it is a case of rejection of books of account, the profit has to be estimated. The Hon'ble ITAT in the case of Shri Shree Krishan Malpani (ITA No. 1045/JP /1997) held that the bogus purchases reflect defect in the books of account and therefore, the books of account of have to b .....

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efore, I do not find any reason to interfere with the order of the AO on this issue. In the result, the appeal is dismissed. 2.3 The ld. AR of the assessee during the course of hearing submitted that the assessee furnished complete details of purchases which included the copies of purchase bills, confirmations, RST/CST No. of the supplier, PAN of the supplier, Proof of payments made against purchases through account payee cheques duly debited and credited in the bank accounts of supplier and the .....

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ed before the AO. The ld. AR of the assessee relied on following decisions to this effect. (1) DCIT vs. Adinath Industries 252 ITR 476 (Guj.) (2) ACIT vs. Gem Stones, 26 TW 511 (ITAT Jaipur ) (3) Radha Mohan Agarwal s ITO , 30 TW 190 (ITAT Jaipur) (4) Om Metals & Minerals Ltd. vs. JCIT, 32 TW 54 (ITAT Jaipur ) (5) Syntexa vs. ACIT, 111 Taxman 47 (Calcutta Bench) The ld. AR of the assessee at last prayed for deletion of addition of ₹ 3,57,741/- on account of unverifiable purchases made .....

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