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The Tax PublishersITA Nos. 3526 & 3527/Mum/2019
2021 TaxPub(DT) 0160 (Mum-Trib)INCOME TAX ACT, 1961
Section 69C
As AO had not doubted sales, entire purchases could not be treated as bogus because there could not be any sale without actual purchases. Therefore, addition @ 12.5% of bogus purchases would meet the ends of justice.
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Income from undisclosed sources - Addition under section 69C - Bogus purchases - No dispute as regards corresponding sales
Assessee was alleged to be beneficiary of Hawala dealers. Accordingly, AO treated entire purchases claimed by assessee as bogus, however, without disputing corresponding sales. Held: As AO had not doubted sales, entire purchases could not be treated as bogus because there could not be any sale without actual purchases. Therefore, addition @ 12.5% of bogus purchases would meet the ends of justice.
Followed:CIT v. Simit P. Sheth (2013) 356 ITR 451 (Guj-HC) : 2013 TaxPub(DT) 2115 (Guj-HC).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2010-11 & 2011-12
INCOME TAX ACT, 1961
Section 271(1)(c)
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