Tribunal upholds addition for alleged bogus purchases, dismisses appeal on lack of evidence. Disallowance of interest expenditure deleted.

The Tribunal dismissed the assessee's appeal against the addition of Rs.26,74,050 for alleged bogus purchases from M/s. Vijaypath Vincom Pvt. Limited. Despite the assessee's contentions, the Tribunal upheld the orders of the revenue authorities, emphasizing the failure to provide evidence of the genuineness of the transactions. Additionally, the Tribunal confirmed the deletion of the disallowance of interest expenditure. The appeal was dismissed, and the decision was rendered on August 25, 2022.

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Issues: Appeal against addition of Rs.26,74,050 for bogus purchases and interest expenditure disallowance.

Analysis:
1. The assessee appealed against the addition of Rs.26,74,050 for alleged bogus purchases. The ld. Assessing Officer found discrepancies in purchases made from M/s. Vijaypath Vincom Pvt. Limited. Despite multiple notices, the party could not be traced. The ld. CIT(Appeals) confirmed the addition, leading to the appeal before the Tribunal.

2. The assessee contended that the ld. CIT(Appeals) erred in confirming the addition. The Tribunal noted that the appeal was ex-parte as the assessee failed to appear despite notices. The Registry highlighted a 211-day delay in filing the appeal, attributed to lockdown and COVID issues. The Tribunal, considering the Supreme Court's directive on limitation during the specified period, condoned the delay and proceeded to decide the appeal on merit.

3. The Tribunal reviewed the case, where the assessee, engaged in manufacturing and trading, declared income of Rs.3,46,112. The ld. Assessing Officer deemed purchases from M/s. Vijaypath Vincom Pvt. Limited as bogus. The Tribunal observed that the onus to prove the genuineness of transactions lay with the assessee. The ld. CIT(Appeals) upheld the addition for bogus purchases but deleted the disallowance of interest expenditure.

4. The Tribunal deliberated on the issue of disallowance of purchases. It noted that if an assessee maintains complete details of traded items, total purchases should not be disallowed. However, in this case, the assessee failed to provide evidence that purchases from M/s. Vijaypath Vincom Pvt. Limited were genuine. Without such details, the Tribunal upheld the orders of the revenue authorities, dismissing the appeal.

5. Ultimately, the Tribunal dismissed the appeal of the assessee concerning the addition of Rs.26,74,050 for alleged bogus purchases. The decision was pronounced in open court on August 25, 2022.

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