TaxTMI 
TaxTMI 
2017 (10) TMI 774
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....passed by the Assessing Officer (AO) relevant to Assessment Year (AY) 2006-07. 2. In the impugned appeal, the assessee has assailed the action of the AO in imposing the penalty of Rs. 8,70,000/- and confirmation thereof by the CIT(A) on the ground that the assessee has neither furnished inaccurate particulars of its income nor concealed its particulars to evade taxes. 3. Briefly stated, the assessee filed a return of income for the AY 2006-07 which was reopened on the basis of a reference of Investigation Wing indicating bogus purchases from M/s.R.R.Patel Trading Corporation to the tune of Rs. 1,28,80,366/- during the Financial Year relevant to AY 2006-07. The assessment was completed under s.143(3) of the Act r.w.s.147 of the Act dat....
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....also transpired that bills raised for purported purchases were prepared by the assessee on the blank bills taken from the supplier. 3.2. Besides, it was further noticed by the AO that there were no other transactions in the bank account of the supplier other than the transactions with the assessee. The actual evidences of purchase of material were also not produced. On these gross facts, the additions towards bogus purchases were carried out by the AO. In the quantum proceedings, the CIT(A) confirmed the addition to the extent of 25% of the purchases booked in the name of the aforesaid supplier on the premise that the aforesaid bogus purchases from RR Patel Trading Corporation was possibly recorded to compensate probable cash purchases f....
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.... Pokhraj Doshi vs. ITO in ITA No.426/Ahd/2013 for AY 2005-06, order dated 26/07/2013 and (ii) decision of ITAT Ahmedabad in the case of Shri Pokhraj P.Doshi vs. ITO in ITA No.1522/Ahd/2013 for AY 2006- 07, order dated 07/07/2016. To buttress its claim for non-imposition of penalty, after the closure of the hearing, two more orders were placed on behalf of the assessee. (1) Decision of ITAT Ahmedabad in the case of Kirti D Vadalia vs. ITO in ITA No.2827 for AY 2002-03 & Ors., order dated 04-05/2016 and (2) decision of ITAT Ahmedabad in the case of Bholaath Poly Fab Pvt.Ltd. vs. ITO in ITA No.807/Ahd/2010, order dated 12/10/2012. In essence, Ld.AR contended that where the circumstances existing for addition/disallowance of purchase itself ....
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....to inflate the expenses. The tell-tale evidence in the form of statement of the supplier and confirmation thereof in the cross-examination by assessee coupled with lack of proof towards delivery of purchase and clouded or suspicious banking transactions recorded to this effect leaves us in no manner of doubt that assessee had deliberately and willfully subverted the real source and character of the transactions. While doing so, the assessee also prevented the revenue from knowing the real source of supply and whereabouts of supplier of the alleged goods purchased, if any. In the circumstances, the appellate authorities were left with no option but to estimate the plausible overstatement of expenditure on purchases and thereby understatement....