2018 (6) TMI 1799

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....ut of the order passed by the DCIT, Circle-9, Ahmedabad. 2. The assessee is engaged in the construction business. The assessee has made certain payments to the respective parties towards purchase of materials for the construction work through account payee cheques. Notice u/s.133(6) of the Income Tax Act, 1961 (hereinafter referred to as "the Act") was issued to the suppliers by the Assessing Officer (AO) for verification of the genuineness of the transactions followed by enquiry through Inspector deputed by the AO regarding genuineness of the addresses of the suppliers but without success. The assessee was thereafter asked to produce the parties in person for verification of the expenses. In fact, the assessee provided the details of th....

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.... 20,40,905/- i.e. 12.5% of total purchase which is impugned before us. The Revenue has come up in appeal against the deletion of addition of Rs. 1,42,86,350/- made by the AO by disallowing the non-genuine/bogus purchases on the premise that the assessee created bogus evidences or have taken bogus purchase bills to claim bogus purchase to evade tax. 3.1. Simultaneously, the assessee has filed a cross-objection on the ground that the ld. CIT(A) has grossly erred in not restricting disallowance made on account of bogus purchases to 5% in view of the judgement passed by the Co-ordinate Bench of this Tribunal. 4. At the time of hearing of the instant appeal, the Ld. Representative of the Department relied upon the order passed by the AO an....

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....owance is to be made to take care of some possible inflation in the purchase price in respect of purchases from Vishal Traders. We hold for only a token disallowance only because of these reasons that the yield reported by the assessee is better in the present year as compared to the preceding year. It is also noted by us that as noted by learned CIT(A), the prices charged by Vishal Traders are at par with other parties and the GP/NP is better in the present year as compared to the preceding year. Hence, we fell that only a token disallowance will meet the ends of justice in the facts of the present case as noted above. Here, this question may be relevant as to when all the above factors are supporting the case of the assessee then why even....