Bogus Purchase Bill

[Prashant Premlani]

Dear Sir,

My purchases have been proved to be bogus.Will sales related to such purchase will also be bogus and assessee will be able to claim lower tax benefit.Please refer case law or section supporting answer.

Thanks & Regards

Prashant

AI Summary

Understanding Tax Implications: Bogus Purchases Affect Set-Offs but May Allow Credit in Certain Cases A user raised a query about the tax implications of bogus purchases, questioning whether related sales would also be considered bogus and if the assessee could claim lower tax benefits. A respondent clarified that if a purchase is deemed bogus, the set-off is reduced by that amount, leading to tax payment. However, certain cases allow the purchaser to take credit despite the bogus nature of the purchase.