TMI Blog2017 (11) TMI 321X X X X Extracts X X X X X X X X Extracts X X X X ..... y in the plea of the assessee for further relief towards downward estimation. - I.T.A. No.948/Ahd/2012 And I.T.A. No.1460/Ahd/2012 - - - Dated:- 2-11-2017 - SHRI S.S. GODARA, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER For The Revenue : Shri K.Madhusudan, Sr.DR For The Assessee : Shri M.J. Shah, AR ORDER PER PRADIP KUMAR KEDIA - AM: The captioned cross-appeals by the Revenue and Assessee are directed against the common order of the Commissioner of Income Tax (Appeals)-I, Ahmedabad [CIT(A) in short] dated 26/03/2012 emanating from the assessment order passed under s.143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) dated 10/12/2010 relevant to Assessment Year (AY) 2008-09 respectively. Revenue s appeal in ITA No.948/Ahd/2012 AY 2008-09 2. The grounds of appeal raised by the Revenue read as under:- 1) The Ld.CIT(A) has erred in law and on facts in deleting the addition of ₹ 1,57,12,258/- out of total addition of ₹ 2,09,49,678/- made on account of bogus purchases. 2) On facts and in the circumstances of the case and in law, the CIT(A) ought to have upheld the entire addition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... odation bills. The AO noted that the assessee has shown purchase of ₹ 2,09,49,678/- from M/s.Vishal Traders during the financial year relevant to AY 2008-09. The AO also observed that a statement of the proprietor of M/s.Vishal Traders Shri Dharmendra J.Pandya was recorded under s.131 of the Act where he categorically admitted that the aforesaid proprietorship concern was not in existence since last two years and bills issued were bogus/adjustment bills only. It was further confessed by the purported supplier that he has not delivered any goods like oil seeds, oil cakes or any other item mentioned in the bill to various parties including the assessee. The transportation details like vehicle numbers written on the bill etc. were also admitted as fictitious. It was further deposed by the proprietor that one Shri Madanlal L.Shah (Chandak) had introduced all the parties to him. It was pointed out that the bogus bills were issued to various concerns towards fictitious supply in lieu of commission payments earned by him. The AO next observed that on perusal of the bank statement of the supplier, a continuous pattern of deposit and immediate cash withdrawal thereafter is seen. The A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de by the supplier adverse to the assessee and finally arrived at the conclusion that the impugned transactions with M/s.Vishal Traders are only an eye-wash and the bills issued by the purported supplier are in effect accommodation bills. The CIT(A) however, observed that while the purchases were not made from M/s.Vishal Traders, the existence of purchases cannot be rejected. The purchases were probably made from other farmers/cultivators who are unregistered dealers. The CIT(A) accordingly concluded that purchase costs recorded by the assessee are inflated. In this background, the CIT(A) estimated addition to the extent of 25% on account of impugned bogus purchases by applying the broad principles laid down by the Hon ble Gujarat High Court in the case of Sanjay Oilcake Industries (2009) 316 ITR 274 (Guj.). The CIT(A) accordingly directed the AO to scale down and restrict the addition made towards bogus purchases from M/s.Vishal Traders to the extent of 25% of ₹ 2,09,49,678/- which comes to ₹ 52,37,420/-. The balance addition to the extent of 75% was thus deleted. 8. Both AO as well as the assessee are aggrieved by the partial relief granted by the CIT(A). While the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dinate Bench of the Tribunal in the case of Shri Jagdish H.Patel vs. ACIT in ITA Nos.582 610/Ahd/2012 order dated 14/03/2016 where addition of 8% was estimated to meet the ends of justice. The Ld.AR submitted that in the aforesaid case before the Tribunal, the supplier was the same i.e. M/s.Vishal Traders. The Ld.AR thereafter referred to the decision of the Hon ble Gujarat High Court in the case of N.K. Industries Ltd.(supra) cited on behalf of the Revenue and submitted that the Ld.DR has misunderstood the conclusion of dismissal arrived at by the Hon ble Gujarat High Court. The Ld.AR submitted that addition on account of bogus purchases was retained at 25% only by the ITAT which was subject matter of consideration before Hon ble High Court under s.260A of the Act.as against the claim of the Revenue that entire amount should be disallowed. 11. We have carefully considered rival submissions. The controversy revolves around the quantification of disallowance on account of bogus purchases. We straight away notice from para-9 of the order of the CIT(A) where it was recorded that the AO himself has accepted that while purchase bills from M/s.Vishal Traders are adjusted bills but t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
