TaxTMI 
TaxTMI 
TaxTMI 
2022 (4) TMI 230
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....dition made by AO on account of bogus purchases. 2. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in not considering that the addition was made on the basis of information received from Sales Tax Department, Maharashtra through DIT(Inv.) with regard to bogus purchases made by the assessee from dealers without supply of actual goods. 3. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in not considering that the hawala dealers have admitted on oath before the Sales Tax Authorities that they have not sold any material to anybody. 4. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in not considering that the assessee could not prove the genuineness and creditworthiness of the purchase transactions during the course of assessment proceedings. 5. Whether on the facts and in the circumstances of the case and in law, the Hon"ble ITAT erred in not considering the facts which are similar to the facts in the decision of Hon'ble Supreme Court in the case of N.K. Proteins v DCIT (SLP(Civil) No.769/2017 dated 16.01.2017, wherein it was held th....
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.....R. of the assessee has given various examples to prove that the issues involved in the case of M/s. N. K. Proteins Ltd. and in the case of assessee are different. He has claimed that the purchases in this case are not "bogus" but could be treated as "inflated". The assessee has further relied on various case laws on the issue involved. 18. The submission made by the representative of the assessee has been perused. However, same is not found to be acceptable. As discussed above, the Hon"ble Supreme Court while upholding the judgment of Hon"ble Gujarat High Court in the case of M/s. N.K. Proteins Ltd. has clearly held that once it comes to a categorical finding that the amount represents alleged bogus purchases from bogus suppliers it is not incumbent to restrict the disallowance to certain percentage. 18.1 In this case, it has been clearly established that the entire purchases made by the assessee were bogus as he obtained purchase bills from bogus suppliers as established during the reassessment proceedings. Therefore, it is clear that the findings in the case of N.K. Proteins Ltd.(Supra.) are squarely applicable in this case. Further the cases laws relied upon by the assessee....
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....0. However, during the re-opened assessment proceedings, the assessee submitted that for the purchases made, there is a corresponding sales angle as well. The income arising from such sales has been shown and offered by the assessee in the profit and loss a/c. Considering the fact of the case, the AO held that it was evident that the Assessee purchased goods from open/grey market for benefits like lower duties, better credit facility, greater bargaining power etc. causes best known to the assessee and to set right the record, assessee obtained accommodation purchase bills from the above parties". (Emphasis Supplied) It is in the above context that the purchases were held to be "bogus" in the re-assessment proceedings since the same were made from open/grey market with accommodation bills arranged from parties. In our view, the judgment in the case of M/s. N.K. Proteins Ltd. (supra), heavily relied upon by the Revenue, would not apply to the facts of the present case. Even the PCIT had no grouse as regards the reason for which purchases were held to be bogus. The PCIT moved on the premise that judgment in the case M/s. N.K. Proteins Ltd., (supra) was applicable and accordingly, his....
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.... peak credit payable during the year for purchases to these parties which included balance of Rs. 18,43,451/- for purchases made in the earlier year, while the AO has , however , not doubted the sales made by the assessee against these purchases. The assessee has reconciled the quantitative details of the stock reflected in these purchases with quantitative details of stock as per sale invoices. The A.O. has doubted the purchases from these four alleged accommodation entry providers being hawala dealers as concluded by Sales Tax Department of Government of Maharashtra to be bogus purchases, that these four parties only provided accommodation bills and the goods were never supplied by these parties and the assessee allegedly made purchases from some other parties for which payments were made through undisclosed income. Thus, the A.O. observed that the assessee has purchased the material from someone else while bogus bills were organized by these hawala dealers, hence, section 69C of the Act was invoked by the AO and additions were made by the AO. The conclusion of the ld. CIT(A) that the assessee has purchased material from some other dealers but quantitative reconciliation of the s....