2016 (8) TMI 372

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....oner of Income Tax (Appeals) fixing the GP rate of 25%. The CIT(Appeals) in turn had passed the order on the respondent-assessee's appeal against the order of the Assessing Officer making an addition of about Rs. 1.32 crores to the respondent-assessee's returned income on account of bogus purchases claimed by it in order to reduce its G.P. and evade payment of taxes. The matter pertains to the assessment year 2009-10. 2. The appeal is admitted on the following substantial questions of law:- (i) Whether on the facts and in the circumstances of the case and in law, having given a findings in para 12.1 that the purchases were bogus and that the assessee had created bogus creditors in the books of account, the Hon'ble ITAT was justified i....

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....Rs. 3.85 crores were shown. A questionnaire was issued on 29.09.2010 to furnish the confirmation of creditors of over Rs. 50,000/- alongwith their PAN numbers and addresses. The confirmation was not furnished in respect of five creditors. There were also discrepancies in the books of accounts in respect of four creditors. The assessee was given sufficient time to show cause in this regard. The Assessing Officer also found the bills to be forged and that in some cases there was a difference in signatures. The CIT(Appeals) upheld the Assessing Officer's decision to reject the books of accounts but applied a G.P. rate of 25% instead of adding an amount of Rs. 1.32 crores to the assessee's income. Cross appeals were filed. The department challe....

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....he assessment year commencing on the 1st day of April, 1988, or any earlier assessment year and references in this section to the other provisions of this Act shall be construed as references to those provisions as for the time being in force and applicable to the relevant assessment year." It is not necessary to refer to the proviso. In making a best judgment assessment, the authorities are entitled to adopt any reasonable approach which would best determine the actual tax liability. 5. The Assessing Officer found in respect of said 9 creditors that they had not furnished the confirmation or that there was a discrepancy in the accounts/documents. He also found that the cash payments on consecutive dates each of less than Rs. 25,000/-....