2023 (7) TMI 515

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....on'ble Supreme Court in the case of N K Protein Ltd. dated 16.01.2017, which is on the similar issue of bogus purchases and when the Hon'ble Apex Court order was already the law of the land when the Hon'ble ITAT has pronounced its order on 01.05.2017?" 6.2 "Whether on the facts and in the circumstances of the case and in law, the Hon'ble ITAT erred in ignoring the decision in the case of N K Proteins/N K Industries by Hon'ble Ahmedabad High Court, further affirmed by Hon'ble Supreme Court, as mentioned at ground No. 1 above, wherein Hon'ble High Court, relying on the findings of the Hon'ble ITAT, Ahmadabad, that the suppliers are bogus, has given a finding that once the suppliers are held bogus, then it is not correct to tax only 2....

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.... income on 22nd September 2009 declaring income of Rs. 27,99,420/-. 3. According to Appellant, a scam was unearthed by the Sales Tax Department in respect of bogus parties who provided accommodation entries. DGIT (Inv.) Mumbai received information that Respondent had taken accommodation entries from bogus parties / hawala dealers to inflate purchases. 4. During the course of assessment proceedings, the Assessing Officer (AO) issued notices under section 133(6) of the Income Tax Act, 1961 (the Act) to 11 non-genuine parties from the list provided by DGIT (Inv.). The AO issued notice under section 142(1) of the Act, calling upon respondent to submit books of account, stock register, details of purchase, vis-a-vis sales along with docume....

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.... conclusion that there was overwhelming evidence to show that Respondent having engaged in bogus purchases and Respondent having not discharged the onus in proving genuineness of the transactions, the CIT (A) could not have concluded that only profit element should be taxed. We have to read an order in its entirety. The CIT(A) also has noted that the AO, in effect, has not considered the purchases per se but only the genuineness of the suppliers. Therefore, the issue would only boil down to finding out the profit element embedded in such purchases which respondent made from some unknown entities. In paragraph 2.4.32 the CIT(A) holds as under: "2.4.32 As narrated earlier, the Ld. A.O. in this case has himself held that the purchases....