TaxTMI 
TaxTMI 
2020 (9) TMI 1275
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....close of the A.Y under consideration. 3. Briefly stated the facts of the case are that the appellant is an individual having source of income from house property, business or profession and income from other sources. During the course of scrutiny assessment proceedings, the Assessing Officer issued notices under section 133(6) of the Income tax Act, 1961 [hereinafter referred to as 'the Act' for short] to the following parties: Sr.No PAN Name Amount Remark/Status 1 AGMPA7207P M/S GEETA METAL INDUSTRIES 12036 Confirmed 2 ARLPS6594B M/S J.K. GENERATORS 6375 No response 3 AACCP3274A M/S PDRV ENTERPRISES (P) 6259557 Confirmed 4 AAEPA7698C M/S PLASTRONICS....
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.... u/s 68 would be Unverified amount X total outstanding creditors sample size 799173 x 62158180 = 1186168 41878671 5. In light of the aforestated fantastic computation, the Assessing Officer made an addition of Rs.11,86,168/-. 6. The assessee strongly agitated the matter before the CIT(A). 7. The ld. CIT(A) was convinced that the formula used by the assessee is without any basis and is arbitrary. However, the ld. CIT(A) confirmed the additions on account of three creditors, namely, U.V. International, J.P. Industries, and B.P. Chemicals as under: i) U.V. International Rs. 4,176/- ii) M/s J.P. Industries Rs. 5,67,713/- iii) M/s B.P. Chemicals Rs. 2,27,484/- 8. Before me, the....
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....he assessee, which was brought to tax, If sales have been effected out of purchases made from these parties, then, it cannot be said that the purchases were bogus. The finding of bogus sale can only lead to the inference that the corresponding amount should be deleted from the turnover of the assessee. The Assessing Officerhas also not rejected the books of account to estimate profit on these transactions in case it was a firm finding that purchases and sales were bogus. The facts of the case of LA Medica (supra) are different in the sense that detailed enquiries were made into the purchases made by the assessee, which were held to be bogus by the AO. It was found that the purchase consideration got deposited in a bank account of an employe....
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....principles, a liability can only be brought into account by a credit entry in the books of account in favour of the person to whom the money is payable' Thus, there is marked difference between a credit representing a liability payable by the assessee and a credit representing monies received from another person. It is because of this distinction, a liability for purchase which has been credited in the account ofthe supplier cannot be added under section 68 of the Act, more so when the purchase has been accepted as genuine and a deduction therefore has been allowed." 12. Further, the decision in the case of Jhabua Power Investments Ltd 938/DEL/2018 dated 21.05.2019, which has been authored by me, needs mention wherein it has been hel....