2018 (5) TMI 1169

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....panak Raval(1046) ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. This appeal is filed by the Revenue to challenge the judgment of the Income Tax Appellate Tribunal dated 14.07.2017 raising following questions for our consideration: "(i) Whether on the facts and circumstances of case and in laws, the Appellate Tribunal is justified in not deciding the primary question as....

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....cer. During such scrutiny assessment, the Assessing Officer noticed that the assessee had made various payments totaling to Rs. 2.08 crores (rounded off) during the relevant previous year through the mode other than account payee cheque or bank draft though each payment exceeded Rs. 20,000/per day. If the assessee would have noticed since he desire to disallow such expenditure in terms of subsecti....

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....ed his purchases by way of getting substantial fictitious bills from GMCPL and accordingly suppress his profit. The cooked up story regarding handing over the cheques to the agent of GMCPL is nothing but a colourable device used by the assessee and his representative to save the assessee from the disallowance u/s. 40A(3) of the IT Act." 4. Eventually, the Assessing Officer disallowed the expend....

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....t embedded therein should be brought to tax. He applied the principles laid down by this Court in case of Vijay Proteins Pvt. Ltd. Vs. CIT reported in 58 ITD 428 and limited the disallowance to Rs. 47.28 lakhs (rounded off). In the process, he revised the assessee's declared gross profit ratio to 5.8% from the declared gross profit ratio of 2.9% by the assessee. He noted that in the earlier ye....