2019 (1) TMI 793

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....the order of Commissioner of Income Tax (A)-1, Aurangabad in confirming the addition of Rs. 8,35,680, i.e. 3% of the alleged Hawala purchases. 2. Briefly, the facts of the case, as emanating from records are; the assessee is an individual engaged in the business of trading in MS Steel, MS Scrap, MS Ingots, MS bars, etc. The assessee filed his return of income for the impugned assessment year on 23-09-2009 declaring total business income of Rs. 3,10,520/-. The assessment order under section 143(3) was passed in the case of assessee on 12-12-2011 determining the total income at Rs. 5,49,701/-. Thereafter, the Department received information from the Maharashtra Sales Tax Department that the assessee has indulged in bogus purchases from ....

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....he addition to Rs. 8,35,680/-, i.e. 3% of the total bogus purchases. Against the findings of the CIT(A), the Revenue is in appeal. assailing deleting of the addition made and the assessee in Cross Objections has also assailed the order of CIT(A) in confirming the addition to the extent of 3%. 4. Ms. Sabhana Parveen representing the Department submitted that the CIT(A) has erred in granting substantial relief to the assessee without taking cognizance of the fact that during re-assessment proceedings the assessee failed to furnish documentary evidences substantiating purchase of material from the Hawala operators. The Assessing Officer had carried out independent enquiries which revealed that the Hawala operators never carried out any b....

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.... below. Without purchases there cannot be sales. The ld. Authorized Representative further submitted that since all the supporting documents substantiating purchase of goods were furnished by the assessee, no addition is called for. The ld. Authorized Representative prayed for modifying the impugned order by deleting the addition made to the extent of 3% of bogus purchases. 6. We have heard the rival submissions and have perused the orders of the authorities below. The solitary issue raised in the appeal by the Revenue and Cross objections by the assessee is against addition deleted/confirmed on account of bogus purchases. The Assessing Officer in re-assessment proceedings made addition of Rs. 2,78,55,984/- as bogus purchases purportedly....