TaxTMI 
TaxTMI 
2011 (5) TMI 961
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.... 2. The only ground raised by the assessee is against the addition of Rs. 12,77,686/- sustained by the learned Commissioner of Income Tax (Appeals) on account of bogus purchase made by the assessee while in the Revenue's appeal, the only ground raised is against the relief of Rs. 29,81,266/- allowed by the learned CIT(A) 3. The facts of the case are that the assessee derives income from trading in iron, angles, plates etc. During the course of investigation, it was found by the Assessing Officer that the purchases claimed to have been made by the assessee from M/s.Girnar Sales Corporation and Shiv Metal Corporation were bogus. The total purchases made from the two parties during the year were as under: i) M/s.Girnar Sales Corporation Rs.....
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....gus purchases is disallowed. He also referred to the decision of the ITAT in the case of ITO Vs. Sun Steel, 92 TTJ (Ahd) 1126 wherein the only disallowance of Rs. 50,000/- out of bogus purchase was made. He also referred to the decision of ACIT Vs. Kulubi Steel, ITA No.1568/Ahd/2008 wherein 12.5% bogus purchase was disallowed. Accordingly, he submitted that a reasonable disallowance out of total purchase during the year under consideration should be made. 6. With regard to the addition for unexplained payment, it is submitted by the learned counsel that entire payment is recorded in the assessee's books of accounts and the amount has been paid by the cheque. When the amount is duly recorded in the books of accounts the same could not be te....
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....ere was no justification for making the addition of Rs. 26,76,559/- as unexplained payment. 9. So far as the bogus purchase is concerned, we find that the Assessing Officer recorded the detailed finding so as to establish that the purchases claimed to have been made from Girnar Sales Corporation and Shiv Metal Corporation was bogus. The learned counsel for the assessee was unable to controvert the factual finding recorded by the AO in this regard. However, there is no dispute that the assessee is only a trader in the iron and steel and it has maintained quantitative details. The statement made by the learned counsel that the purchases claimed to have bee made by the assessee from Girnar Sales Corporation and Shiv Metal Corporation is duly ....
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....nd therefore sustained the disallowance for bogus purchase at 25%. In the case of Sunsteel (supra), the ITAT deemed it fit to sustain the disallowance for a lumpsum amount of Rs. 50,000/-. However, we find that in the case of Shri Anubhai Shivlal (supra) the ITAT has considered both the decisions in the case of Vijay Proteins and Sunsteel (supra) and thereafter sustained the disallowance at 12.5%. Relevant findings of the ITAT in the case of Anubhai Shivalal reads are under: 3. At the time of hearing before us, it is submitted by the learned counsel that the addition sustained is excessive. In support of this contention he referred to the decision of the Tribunal in the case of ITO Vs. Sun Steel 92 TTJ (Ahd) 1126 wherein the Tribunal has s....