The Tax Publishers2020 TaxPub(DT) 4985 (Kol-Trib)

INCOME TAX ACT, 1961

Section 68

Where AO, in assessment order added entire alleged bogus purchase made from S in the hands of the assessee, considering that sales were accepted by AO/Department and without purchases, there cannot be sales and further there was possibility of the assessee purchasing/trading of rice from other sources and procuring bills from the accommodation entry provider could not be ruled out, GP addition of 4% was held to be sufficient to meet the ends of justice.

Income from undisclosed sources - Validity of action of AO adding entire alleged bogus purchase - Addition only towards gross profit element embedded in alleged bogus purchases -

Assessee was aggrieved by order of AO, wherein entire alleged bogus purchase made from S were added in the hands of the assessee. Held: It was significant to note that sales were accepted by AO/department. Without purchases, there cannot be sales. Possibility of the assessee purchasing/trading of rice from other sources and procuring bills from the accommodation entry provider could not be ruled out. Therefore, entire alleged bogus purchase made from S could not be added in the hands of the assessee. Estimation of profit from the sale of rice could be justified. In the rice trading G.P of 3 to 5 % was there during the assessment year under consideration. Therefore, GP addition of 4% would be sufficient to meet the ends of justice.

REFERRED :

FAVOUR : Partly in assessee's favour.

A.Y. : 2013-14



IN THE ITAT, KOLKATA BENCH

SUBSCRIBE TaxPublishers.inSUBSCRIBE FOR FULL CONTENT

TaxPublishers.in

'Kedarnath', 7, Avadh Vihar, Near Nirali Dhani,

Chopasni Road

Jodhpur - 342 008 (Rajasthan) INDIA

Phones : 9785602619 (11 am - 5 pm)

E-Mail : mail@taxpublishers.in / mail.taxpublishers@gmail.com