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TMI Blog2023 (9) TMI 500X X X X Extracts X X X X X X X X Extracts X X X X ..... Kumar. For the Respondent : None present. P.C. : 1. Mr. Suresh Kumar states that Respondent has been served. Respondent, however, is absent. 2. The Appeal filed is under Section 260A of the Income Tax Act, 1961 ("the Act"). The following two questions of law are proposed in the Appeal : i. Whether on the facts and circumstances of the case and in law, the ITAT has erred in partly allowing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sales Tax Department that certain parties are engaged in the business of providing accommodation bills without actually supplying the materials and upon noticing that the assessee has purchased goods from some of such parties in the three years under consideration, the Assessing Officer ("AO") reopened the assessments of those three years. Assessee filed its return of income on 14th October 2010 d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he legality and validity of the impugned order passed by the ITAT to the extent it was against the Revenue. 4. AO had noticed that the assessee did not have evidence for transportation of materials, receipt and consumption of materials. Assessee could produce only bills and payment details. Assessee could not obtain confirmation letters from the suppliers to prove the genuineness of the purchases ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this kind of situation, the principle of taxing the profit embedded in such purchases covered by the bogus bills, should only be disallowed instead of disallowing entire expenditure. The CIT(A) also took this view but adopted the net profit rate for sustaining the addition. The ITAT modified the order of CIT(A) to adopt the gross profit level, but retain the addition to the extent of 12.50% of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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