TMI Blog2022 (6) TMI 509X X X X Extracts X X X X X X X X Extracts X X X X ..... owed. - ITA Nos. 5921, 5922, 5923 And 5924/MUM/2019 - - - Dated:- 23-5-2022 - Shri Vikas Awasthy, Hon'ble Judicial Member And Shri S. Rifaur Rahman, Hon'ble Accountant Member For the Assessee : Shri Rajesh Shah For the Department : Shri Mehul Jain ORDER PER S. RIFAUR RAHMAN (AM) 1. These appeals are filed by the assessee against common order of the Learned Commissioner of Income Tax (Appeals) 29, Mumbai [hereinafter in short Ld.CIT(A) ] dated 17.06.2019 for the A.Ys.2009-10, 2011-12, 2012-13 and 2014-15. 2. Since the issues raised in all the appeals are identical, therefore, for the sake of convenience, these appeals are clubbed, heard and disposed off by this consolidated order. We are taking Appeal in ITA.No. 5921/MUM/2019 for Assessment Year 2009-10 as a lead case. 3. Assessee has raised following grounds in its appeal: - 1. The Ld. CIT(A) has erred in confirming the reopening of assessment u/s 147 of The Income Tax Act 1961. 2. The Ld. CIT(A) has erred in confirming the addition of Rs.6,59,919/- on account of profit on alleged bogus purchase @ 4%. 3. The Ld.CIT(A) has erred in, not following the order of Hon ble Bomba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee along with the various judicial pronouncements restricted the Gross Profit/disallowance to the extent 4% of the non-genuine purchases. The assessee is in appeal against the order of the Ld.CIT(A). 7. Before us, the Ld. Counsel for the assessee reiterated the submissions made before the lower authorities. Ld. AR of the assessee submitted that assessee has already declared Gross Profit @10.83% and Gross Profit on alleged bogus purchases after adjusted Gross Profit is 10.76%. He also placed reliance on the decision of the Hon'ble Bombay High Court in the case of Pr.CIT v. M/s. Mohommad Haji Adam Co. in Income Tax Appeal No. 1004 of 2016 dated 11.02.2019 and submitted that the Assessing Officer may be directed to estimate the Gross Profit on the non-genuine purchases to similar percentage as shown in the genuine purchases for the purpose of disallowance. 8. On the other hand, Ld. DR submitted that the decision in the case of Pr.CIT v. M/s. Mohommad Haji Adam Co. (supra) relied on by the assessee is distinguishable to the present facts, since the issue involved in the above case is that the assessee is a trader whereas in the given case assessee is involve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... who is a trader of fabrics. During the survey operations in case of the entities from whom the assessee had claimed to have made purchases, the department collected information suggesting that such purchases were not genuine. The Assessing Officer ( A.O. for short) noticed that the assessee had shown purchases of fabrics worth Rs.29.41 Lacs (rounded off) from three group concerns, namely, M/s Manoj Mills, M/s Astha Silk Industries and M/s Shri Ram Sales Synthetics. On the basis of the statement recorded during such survey operations, the A.O. concluded that the selling parties were engaged only in supplying the bogus bills, that the goods in question were never supplied to the assessee, and therefore, the purchases were bogus. He, therefore, added the entire sum in the hands of the assessee as its additional income. 3 The assessee carried the matter in the appeal before the Commissioner of Appeals who accepted the factum of purchases being bogus. However, he compared the purchases and sales statement of the assessee and observed that the department had accepted the sale, and therefore, there was no reason to reject the purchases, because without purchases there cannot be s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the basis of fictitious invoices have been debited in the trading account since the transaction has been found to be bogus. The Tribunal having once come to a categorical finding that the amount of Rs.2,92,93,288/- represented alleged purchases from bogus suppliers it was not incumbent on it to restrict the disallowance to only Rs.73,23,322/ 6 Counsel pointed out that the S.L.P. against such decision was dismissed by the Supreme Court. 7 On the other hand, Ms Khan learned counsel for the assessee opposed the appeals contending that the Tribunal has given proper reasons. The assessee was a trader. Even if the purchases are found to be bogus, entire purchase amount cannot be added by way of assessee's income. 8 In the present case, as noted above, the assessee was a trader of fabrics. The A.O. found three entities who were indulging in bogus billing activities. A.O. found that the purchases made by the assessee from these entities were bogus. This being a finding of fact, we have proceeded on such basis. Despite this, the question arises whether the Revenue is correct in contending that the entire purchase amount should be added by way of assessee's additio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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