TaxTMI 
TaxTMI 
2016 (9) TMI 1276
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....ecord perused. During the course of assessment for A.Y.2010-11, the AO observed that as per information received from Sales Tax Department, some of the parties were bogus supplier and the assessee was found to be having purchased materials from the eight parties, who were reported to be bogus by the Sales Tax Department. Accordingly, the AO made addition of Rs. 1,19,80,841/- in respect of these parties. The assessee was asked vide Show Cause Notice to provide the whereabouts of the parties, the assessee himself submitted the ledger, of the parties which were not relied upon by the AO as the assessee has not produced the parties. In view of the findings in the paragraph no.4, it was held by the Assessing Officer that the assessee did not pur....
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....fit and Loss Account of the Appellant. 6. If the action of the assessing officer of treating the purchases of Rs. 1,19,80,841/- is upheld on the ground that the alleged purchases were bogus, his gross profit would work out to 21.99% which is not tenable especially keeping in mind that he is a contractor for Government where such margins are not available in the tendered contracts. 7. However, the facts also remains that the above alleged bogus purchases are not fully verifiable and the parties were not produced for verification. In view of the above, the Assessing Officer is directed to make a lump sum addition of Rs. 3,00,000/- as the income escaped tax and delete the balance 'addition. This ground of appeal is partly allowed. ....
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....CIT, ITA No.2239/Mum/2012 iv) Shri Deepak Popatlal Gala Vs. ITO, ITA No.,5920/Mum/2013 v) Babulal C. Borana Vs. Third ITO, 282 TR 251(Bom) vi) Rajeev G. Kalathil Vs. DCIT, 67 SOT 52(Mum Trib) vii) CIT Vs. Nangalia Fabrics Pvt. Ltd., 220 taxman 17 (guj) viii) CIT Vs. Nikunj Eximp Enterprises pvt. Ltd., 216 taxman 171 ix) CIT Vs. M.K.Brothers, 163 ITR 249 x) ITO Vs. Premanand, 107 TTJ 395 xi) Arora Alloys Ltd., 370 ITR 372 8. We have considered rival contentions and carefully gone through the orders of authorities below. We had also deliberated on the judicial pronouncements referred by AO and CIT(A) in their respective orders as well as considered the ratio laid down by various decisions cited by ld. DR and AR during the course of h....
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.... enquires for making the addition especially since the assessee has discharged its primary onus of showing books of account, payment by way of account payee cheque and producing bills for purchase of goods. From the record we found that the gross profit of the assessee has been consistently growing year after year which is depicted in the table below and which has been accepted by the Department: Assessment Year Sales Gross Profit GP Ratio 2008-09 21,59,13,671 2,06,07,377 9.54% 2009-10 30,70,57,145 3,91,87,695 12.76% 2010-11 23,89,16,358 4,05,61,675 16.97% 2011-12 13,48,05,536 3,07,24,335 22.79% The accounts of the appellant were duly audited u/s 44AB of the Act and the same have not been rejected by AO. However....
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.... 370 ITR 372, wherein it was held as under:- Section 69C of the Income-tax Act, 1961 - Unexplained expenditure - Assessment year 2004-05 - Where addition on account of unexplained expenditure incurred for purchase of raw material was solely based on information received from Central Excise department, same could not be sustained In favour of assessee. 11. The decision of Hon'ble Bombay High Court in the case of Babulal C. Borana v. Third Income-tax Officer [2005] 144 TAXMAN 674 (Bom) also supports our contention. 12. Furthermore, the hon'ble Gujarat High Court in the case of Commissioner of Income-tax v. M.K. Brothers (Gujarat High Court) (163 ITR 249), held as under:- [Section 69 of the Income-tax Act, 1961 - Unexplained investments -....