TaxTMI 
TaxTMI 
2017 (12) TMI 785
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....ef facts of the case are that the assessee the sole proprietor M/s Raj Hans Metal Syndicate, engaged in the business of trading in ferrous and non ferrous metal, filed its return of income for the assessment year under consideration declaring total income of Rs. 18,12,985/-. Since, the case was selected for scrutiny, notices u/s 142(2) of the Act, was issued time to time and the authorized representative appeared before AO and also filed the details called for. In order to verify the genuineness of the purchases made by the assessee during the relevant year, notices u/s 133(6) of the Act, were issued to the parties from whom the assessee had alleged to have purchased the goods. However, notices issued to Prayash Steelage, Manglik Metal (Ind....
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....following decisions: a. DCIT 25(3) vs. Rajeev G. Kalathil I.T.A. No. 6727/Mum/2012 order dated 20.08.2014. b. Hiralal Chunilal Jain ITAT c. Nikunj Eximp Enterprises Pvt. Ltd. (372 ITR 619). Your petitioner submits that the total purchase effected by him from so called bogus dealers is Rs. 78,80,961/- and not Rs. 94,30,485/- which includes opening balances of some of the suppliers. 3. The Learned Commissioner of Income tax has further erred in ignoring the facts that the assessee had earned Gross Profit of 12.16% from sale of Rs. 10,09,46,875/- which is on the higher side. 4. The order appealed against is bad in law and is against the principle of natural justice. 5. The order appealed is based on surmises and conjecture....
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....gone through the cases relied upon by the authorities below as well as referred before us. The only grievance of the assessee is that the Ld. CIT (A) has wrongly sustained the addition of 12.5% of the bogus purchase. We notice that the AO has not rejected the books of account and accepted the sales shown by the assessee. Since, the AO has not rejected the sales shown during the relevant year, the entire amount of purchases cannot be added to the income of the assessee as there cannot be sale without any purchase. If the assessee had not purchased the goods in question from the parties concerned, it implies that purchases were made from the parties other than those mentioned in the books of account. Hence, there is no justification in making....