TaxTMI 
TaxTMI 
2023 (4) TMI 337
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....the Assessment Year 2016-2017. 2. The only issue raised by the Revenue is that the learned CIT(A) erred in deleting the addition made by the AO on account of bogus purchases. 3. The briefly stated facts are that the assessee is partnership firm and engaged in the business of real estate. The AO during the assessment proceeding has made bogus purchases from 7 parties amounting to Rs. 1,84,77,669/- only. Thus, the AO disallowed the same and added to the total income of the assessee. On appeal by the assessee, the learned CIT(A) held that genuineness of impugned purchases cannot be accepted as the assessee failed to discharge its onus fully but entire gross amount of purchase also cannot be disallowed. Accordingly, the learned CIT(A) confirm....
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....he appellant without incurring expenditure on purchases. The Courts have taken a consistent view that the entire amount of unaccounted receipts/unaccounted sale /on-money receipts cannot be brought to tax in the cases of builders and developers. Only the net profit embedded in the gross unaccounted receipts can be taxed. In the case of CIT Vs. Gurubachhan Singh J. Juneja [2008] 302 ITR 63 (Guj.) it has been held by the Hon'ble High court of Gujarat that:- "in absence of any material on record to show that there was any unexplained investment made by the assessee which was reflected by the alleged unaccounted sales the finding of the Tribunal that only the gross profit on the said amount can be brought to tax does not call for any int....
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....did purchase the cloth and sell finished goods. In that view of the matter, as natural corollary, not the entire amount covered under such purchase, but the profit element embedded therein would be subject to tax. This is the view of this Court in the case of Sanjay Oilcake Industries Vs. CIT 316 ITR 274 (Guj.). Such decision also followed by this Court in a judgment dated 16.08.2011 in Tax Appeal No.679 of 2010 in the case of CIT Vs. Kishore Amrutlal Patel." Hon'ble Gujarat High Court in the case of CIT Vs. Pradeep Shantilal Patel 42 Taxmann.com 2 (Gujarat) has held "Where assessee admitted that cash deposits pertained to his retail business but details and nature of business were not forthcoming from record, considering total turno....
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....re us. 5. The learned DR before us reiterated the findings contained in the assessment order. 6. On the other hand, the learned AR before us filed a paper book running from pages 1 to 80 and contended that the assesse out of the purchases has shown sales which have not been doubted by the authorities below. Therefore, there is no question of treating hundred percent purchases as income of the assessee. The learned AR vehemently supported the order of the learned CIT-A. We have heard the rival contentions of both the parties and perused the materials available on record. Admittedly, the purchases made by the assessee firm from 7 parties amounting to Rs. 1,84,77,669/- were treated as bogus. However, it is undisputed fact that the sales decl....