TaxTMI 
TaxTMI 
2021 (1) TMI 607
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.... the addition made by the AO on account of disallowance of non-genuine purchases from Rs. 4,98,74,852/- to Rs. 62,34,360/-. 2.On the facts and circumstances of the case and in law, the CIT(A) has erred in directing to make an addition of 12.5% of unverified purchases which is not as per law. Once purchases are not genuine then either entire such purchases are to be disallowed or books of accounts ought to have been rejected and G.P. estimated. 3. On the facts and circumstances of the case and in law, the CIT(A) has not considered the fact that even in the case of M/s.Mayank Diamonds Pvt.Ltd referred by him, the Hon'ble Guj.High Court has directed to estimate G.P. @ 5%, and not made 12.5% of unverified purchases were directed to be a....
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....assessee filed his reply dated 19.03.2015. In the reply, the assesse stated that they have already filed confirmation, purchase bills, bank statements, stock register, and copy of income tax return (ITR) of parties. It was also stated that all transactions were routed through banking channel. The contention of assessee was not accepted by AO. The AO concluded that the merely transaction routed through banking channel is not sufficient evidence. Bhanwarlal Jain Group was engaged in providing accommodation entries which clearly proved that all the concern belongs to Bhanwarlal Jain Group engaged in providing bogus entries of cash in books. With regard to the contention of the assessee not made any transaction with Bhanwarlal Jain Group, the ....
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.... and seizure action under section 132 on Bhanwarlal Jain Group. Bhanwarlal Jain Group during the search and post search action admitted that this group is engaged in providing accommodation entries. The assessee is one of the beneficiaries of bogus entries. The AO on the basis of the report of Investigation Wing was having information about the modus operandi adopted by Bhanwarlal Jain Group. The assessee is one of the beneficiaries of bogus entries. During the assessment the AO issued show cause notice for disallowance of purchases. The AO after affording opportunity to the assessee and considering the submission made before him, treated the entire purchases from Bhanwarlal Jain Group as a bogus purchases. The ld.CIT(A) restricted the addi....
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....cause notice the assessee specifically stated that purchases were from both the concern in normal course of business and that they have no business dealings belonging with Bhanwarlal Jain Group and that they do not know group as far as transactions of purchases are concerned. There is no corroborative evidence to prove that assessee has bogus accommodation entries from this Hawala Group. The AO relied on the statement of Bhanwarlal Jain Group without providing copy and cross-examination of those persons who made statement regarding the Hawala Entries. The AO merely relied on third party information which has no concern with the assessee. The AO has not issued notice under section 133(6) or summon under section 131 of the Act for verificatio....