TaxTMI 
TaxTMI 
2026 (7) TMI 897
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....r short "the Act"), raising the following substantial questions of law arising out of the judgement and order dated 05.08.2024, passed by the Income Tax Appellate Tribunal, Surat Bench, (for short "the Tribunal"), in ITA No. 48/SRT/2023 for the Assessment Year 2013-14 and ITA No. 157/SRT/2023 for the Assessment Year 2013-14. "a) "Whether the learned ITAT has erred in restricting the addition to 6% of the total bogus purchases against the addition made by the AO at the rate of 100% of bogus purchases amounting to Rs. 12,37,49,657/-?" b) "Whether the Ld. ITAT erred in dismissing the appeal of the revenue and restricting the addition to 6% of the total bogus purchases, not appreciating the non-genuineness of the expenditure b....
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....igation Wing, Mumbai, treated the entire purchase from Rajan Gems as non genuine purchase and added the same under Section 69(C) of the Act in the Assessment Order issued under Section 143(3) of the Act dated 23.03.2016. 3.3 Being aggrieved, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals), Surat, who vide order dated 07.11.2014, determined that the gross profit was estimated at 5% of the total turn over instead of disallowing of entire purchases. 3.4 Being aggrieved by the decision of the Commissioner of Income Tax (Appeals), both the parties preferred appeal and X-appeal before the Tribunal. The assessee in his appeal challenged the action of the Assessing Officer in rejecting the books of accounts an....
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.... "14. We find that the grounds of appeal raised by the assessee and revenue are interconnected. The assessee is aggrieved by the findings of ld CIT(A) in restricting the addition of impugned purchases to the extent of 5% shown from Rajan Gems, an entity controlled and managed by Gautam Jain and his family. On the other hand, the Revenue is also aggrieved in restricting such addition only to 5% and prayed for 100% disallowance. We find that the Assessing Officer has not disputed the sale of assessee. No sale is possible in absence of purchases. Quantitative and qualitative details are not disputed. The Assessing Officer solely relied upon the report of the Investigation Wing, Mumbai without providing statement of Gautam Jain or his family m....
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....ing the Tax Appeal No. 617 of 2022 has held as under: "5. The Assessing Officer noticed the contentions of the assessee that confirmation, purchase bills, bank statement, stock register, copy of ITR were already filed. The Assessing Officer was, however, of the view that transactions were bogus and merely that it routed through the banking channel, was not sufficient to conclude that they were the genuine transactions. The contention of the assessee that he had not dealt with the Bhanvarlal Jain Group was also negatived. The appellate Commissioner took the view that disallowance was required to be sustained at 12.5% of the purchase. The Assessing Officer was directed accordingly to workout disallowance. In para 10.6, the C....
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....l are based on material before it and after analysing the facts and figure available before it. When the Tribunal has thought it fit to restrict the disallowance at 6% instead of 5%, the Tribunal had before it the facts which were duly analysed by it. No interference is called for in the said conclusion and findings of the Tribunal in the present appeal by this Court. 7. The another weighing aspect in Tax Appeal No. 832 of 2024, which came to be decided by the Co-ordinate Bench of this Court on 23.09.2024, dealt with the same issue on accommodation entries. In another matter, i.e. in Tax Appeal No. 674 of 2022 in the case of Principal Commissioner of Income Tax vs. M/s. Surya Impex, co-ordinate Bench on 16.01.2023 has also dealt with the....