Tribunal upholds order disallowing alleged bogus purchases for AY 2009-10 to 2011-12

The Tribunal, comprising Shri Mahavir Singh and Shri G Manjunatha, dismissed the assessee's miscellaneous applications challenging a consolidated order regarding alleged bogus purchases for AY 2009-10 to 2011-12. Despite the appellant's arguments and evidence, the Tribunal found no prima facie mistake apparent on record to warrant rectification under section 254(2) of the IT Act, 1961. The original consolidated order disallowing the alleged bogus purchases was upheld, and all miscellaneous applications were dismissed on 28.08.2019.

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Issues:
Challenging consolidated order on alleged bogus purchases for AY 2009-10 to 2011-12.

Analysis:
The judgment pertains to three miscellaneous applications filed by the assessee under section 254(2) of the Income Tax Act, 1961, against a consolidated order issued by the Tribunal for assessment years 2009-10 to 2011-12. The primary contention revolved around the disallowance of alleged bogus purchases amounting to Rs. 4,39,887 for AY 2009-10. The assessee contested the 100% disallowance, emphasizing the submission of documentary evidence and withdrawal of the offer of surrender without penalty. The appellant highlighted the submission of a paper book with supporting evidence before the ITAT, indicating a lack of opportunity to present arguments on the merit of the case. The appellant also pointed out factual inaccuracies in the Tribunal's order regarding the submission of purchase bills and the withdrawal of the surrender offer. Additionally, the appellant relied on a High Court decision and other bench rulings to support the contention that additions in bogus purchase cases should be limited to the gross profit. The appellant requested the Tribunal to recall the order and provide a fair hearing.

The Tribunal, comprising Shri Mahavir Singh and Shri G Manjunatha, thoroughly examined the arguments presented by both parties. The Tribunal noted the AO's additions towards alleged bogus purchases from certain dealers and the assessee's surrender of income during assessment proceedings. The Tribunal emphasized the admission by the assessee's counsel and the investigation wing's report supporting the conclusion that the purchases were bogus. Despite the appellant's contentions, the Tribunal found no prima facie mistake apparent on record that warranted rectification under section 254(2) of the IT Act, 1961. Consequently, the Tribunal dismissed the miscellaneous applications for AY 2009-10, 2010-11, and 2011-12, upholding the original consolidated order. The judgment was pronounced on 28.08.2019, and all miscellaneous applications were dismissed.

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