2018 (1) TMI 1412

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....ssessee wherein the assessee is aggrieved that the learned Commissioner of Income Tax (Appeals)-53, Mumbai ('ld.CIT(A) for short) dated 25.01.2018 has erred in sustaining 12.5% disallowance on account of bogus purchases for the assessment year (A.Y. for short) 2009.10. 2. The grounds of appeal read as under:- 1. (a) On facts and circumstances of the case and in law, Ld. CIT(A) erred in....

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....he facts and circumstances of the case and in law, the CIT (A), erred in dismissing the ground for the appellant's plea of withdrawal of initiation of penalty proceedings u/s 271(1) (c). 3. The assessing officer (A.O. for short) in this case has made 12.5% addition on account of bogus purchase amounting to Rs. 9,44,174/-. 4. Upon the assessee's appeal, the ld. CIT(A) confirmed the same. ....

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....e inference has been drawn due to the inability of the assessee to produce the suppliers. I find that in this case the sales have not been doubted. It is settled law that when sales are not doubted, 100% disallowance for bogus purchase cannot be done. The rationale being no sales is possible without actual purchases. This proposition is supported from the Hon'ble jurisdictional High Court deci....

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.... earned by the assessee on these bogus purchase transaction is to be taxed, the gross profit already shown by the assessee and offered to tax should be reduced from the standard 12.5% being directed to be disallowed on account of bogus purchase. 8. Upon careful consideration, I find considerable cogency in the submission of the learned counsel of the assessee, as otherwise it will be double jeo....