TaxTMI 
TaxTMI 
2023 (7) TMI 127
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....ee') had filed an appeal against the assessment order in form 35 before the Ld. Commissioner of Income Tax (Appeals)-35 [hereinafter referred to as the Ld. CIT(A)], but the consultant of the assessee has neither attended the appeal before the Ld. CIT(A) nor informed the assessee to make some alternate arrangements and consequently the Ld. CIT(A) got annoyed and decided the appeal on 07.08.2019 by making 100% addition of bogus purchases as against addition of 12.5% made by the Assessing Officer (AO) on the alleged bogus purchases that all the papers/bills were in the possession of previous tax consultant who looked after the income tax matters of the assessee and unfortunately due to some personal reasons he was out of town so the assessee c....
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....tain the present appeal. So appeal is ordered to be registered and is hereby heard. 4. The assessee by filing the present appeal, sought to set aside the impugned order dated 07.08.2019 passed by Commissioner of Income Tax (Appeals), Mumbai [hereinafter referred to as the CIT(A)] qua the assessment year 2010-11 on the grounds inter-alia that :- "GROUND I To condone the delay in filing the Appeal: The appellant crave leave to condone the delay in filing the appeal as the circumstances were beyond his control. Neither I was aware of any such order by CIT-A nor received the order copy. I have shifted to Nashik and received the order copy in May'22 when I visited my old place of business. The above fac....
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....(ia) when the copy of ITR and duly audited accounts which included receipts from appellant were submitted during the proceedings. GROUND III To Delete the alleged additions Appellant is trader in "Non-ferrous Steel" and there were corresponding sales made by me. The Ld. A.O has verified all the sales and relevant records say Purchase Bills, Sales Bills, Delivery Challans, Ledger Accounts, Bank book etc. Appellant books were neither rejected by Ld. A.O. nor by CIT-A. therefore alleged additions made by CIT-A should be deleted. GROUND IV To Drop the penalty levied u/s 271(1) (c) Kindly delete the penalty levied by the Ld. A. O. of Rs. 53,21,430 on me as Penalty cannot be levied on estimate....
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.... 4 SHREE OMKAR ENTERPISES 1146852 5 RISHABH STEEL INDUSTIRES 1026230 6 VIDHI METAL INDUSTRIES 584503 7 LITTLE WORLD TRADE IMPEX PVT LTD 567051 8 REGISTHAN META. (INDIA) 721266 9 APOLLO METALS 769039 TOTAL 58f69,921/- 7. Declining the contentions raised by the assessee that he has made purchases to comply with the VAT provisions and make payment accordingly which fact is proved from TAN and VAT number supported with bank accounts which proved the identity of the supplier and as such purchases were not bogus, the AO proceeded to make an addition of Rs. 7,33,740/- to the business income of the assessee equivalent to 12.5% of Rs. 58,69,921/-, unproved purchases and thereby f....
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....019 order dated 29.09.2020 and in the case of Ravindranathan Nair vs. Income Tax Officer in ITA No.2662/M/2018 order dated 31.12.2018. 11. However, on the other hand, the Ld. D.R. for the Revenue to repel the argument addressed by the Ld. A.R. for the assessee contended that in such cases total amount of the bogus purchases needs to be added to the income of the assessee and relied upon the order passed by the Ld. CIT(A). 12. In the identical facts and circumstances of the case where though the purchases found to be bogus by the Revenue Authorities but sales by the assessee have been accepted as genuine as against these bogus purchases, we are of the considered view that when sales have been accepted being genuine the entire purchases....
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....as a natural corollary not the entire amount covered by such purchase but the profit element embedded therein would be subject to tax." 13. Undisputedly on the basis of material/evidence available on record before the AO as well as the Ld. CIT(A) it is proved that the assessee has made bogus purchases to the tune of Rs. 58,69,921/- from 9 parties detailed in the preceding paras. It is also not in dispute that the Revenue Authorities have not disputed the sales made by the assessee during the year under consideration. Even otherwise there cannot be any sale without purchases. 14. In the backdrop of the aforesaid undisputed facts when we examine the impugned order assed by the Ld. CIT(A), though the order is passed by touching the merit....