TMI Blog2017 (8) TMI 712X X X X Extracts X X X X X X X X Extracts X X X X ..... e that the assessee might not have made the purchases from these parties, but to save tax might have made the purchases from some other parties and procured the bills these parties. This does not prove that there had not been actual purchases made by the assessee. By making purchases from some other parties the assessee might have saves tax. To that extent the assessee may have earned income. Therefore, we do not find any illegality or infirmity in the order of the CIT(A) in reducing the addition to 12.5%. Appeal filed by the Revenue is dismissed - ITA No.4294 /Mum/2015 - - - Dated:- 15-6-2017 - Shri P K Bansal, Vice President And Shri Pawan Singh, Judicial Member For The Appellant : Shri Majoj Kumar For The Respondent : Shri K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and tribunals. IN many judicial pronouncements on the issue, the courts have taken a consistent view that in case of non-existent parties from whom the purchases are shown to have been made, only part of such purchases can be disallowed, in the cases where the corresponding sales are treated as genuine, or alternatively the profit embedded in such sales against the alleged bogus purchases, can only be brought to tax. 44. In the case of CIT-1 Vs Simit P. Sheth, ITA no. 553 of 2012, order dated 16/01/2013, while deciding a similar issue, the Hon ble High Court of Gujarat has held that We are broadly in agreement with the reasoning adopted by the Commissioner (Appeals) with respect to the nature of disputed purchases of steel. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner of Income Tax-1 vs. Bholanath Poly Feb Pvt. Ltd. vide order dated 23.10.2012 passed in Tax Appeal No. 63 of 2012. The view taken by the Tribunal in case of Vijay Proteins Pvt. Ltd. Vs. CIT reported in 58 ITD 423 came to be approved. 45. Similarly while dealing with an identical issue, in the case of CIT, Vs. Bhalanath Poly Fab (P) Ltd., I.T.A. No. 63 of 2012, in the order dated 23/10/2012, the Hon ble High Court of Gujarat.-has held as under:- We are of the opinion that the Tribunal committed no error. Whether the purchases themselves were bogus or whether the parties from whom such purchases were allegedly made were bogus is essentially a question of fact. The Tribunal having examined the evidence on record came to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ord any comparable bills/invoices for purchases of similar items made from other parties to establish that the purchase price paid to the 2 parties in question were at par with the purchases made from other parties during the period under consideration. In the absence of any such evidence placed on record, the correctness of the purchase price mentioned on such bills/invoices issued by the party in question cannot be accepted and therefore some additional gross profit need to be estimated on the purchases made from the above parties in question. 48. As the purchases invoices issued against the alleged bogus purchases remains unverifiable, and part of the profit element on the purchases made from the above mentioned 2 parties i.e. M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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