2024 (9) TMI 1056

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....: Mr. Satish Modi PC:- 1. Appellant is impugning an order dated 22nd August 2017 passed by the Income Tax Appellate Tribunal ("ITAT") dismissing two appeals filed by Revenue for AY 2009-10 and 2011-12. 2. The Assessing Officer ("AO") had allegedly received information that several parties from whom assessee had shown purchases had stated before the Sales Tax Department that they were indu....

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....-, as bogus purchases. 3. Assessee filed an appeal before the Commissioner of Income Tax (Appeals) [CIT(A)]. The CIT(A) upheld the reopening of the assessment and also observed that the parties were bogus. The CIT(A), however, was of the view that the entire expenditure in respect of purchases could not have been disallowed because the sales were not doubted and without purchases there cannot b....

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....was justified in not confirming the order of the Assessing Officer disallowing the entire expenditure shown in respect of the bogus purchases? B. Whether on the facts and in the circumstances of the case and in law, the Hon'ble Income-tax Appellate Tribunal was justified in confirming the decision of the Id. CIT(A) in restricting the disallowance to 12.5% of the total amount of bogus ....

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....nfirmation of suppliers, etc. The AO did not accept the evidence but instead, made independent inquiries and added the amount in assessee's income. The AO, however, has not disputed the sales made by assessee out of such purchases. The CIT(A) has given detailed findings for justifying addition to the extent of 12.5% only. The Courts have time and again held that only the profit element in the alle....