2012 (10) TMI 1211 - AT - Income Tax

Summary

Issues involved:
The judgment involves cross-appeals by the assessee and the Revenue for A.Y.2005-2006 and 2006-2007 against the orders of the Commissioner of Income-Tax (Appeals)-I, Baroda.

A.Y.2005-2006 (Assessee's appeal):
The assessee contested the addition made by the Assessing Officer (AO) on purchases from M/s.R.R.Patel Trading Corporation as bogus. The CIT(A) reduced the addition to 25% of the purchase amount. The ITAT, Ahmedabad had previously applied a rate of 12.5% in similar cases. The Tribunal found that the purchases were actually made from unregistered dealers at lower rates. Considering the difference in purchase rate and GP rate, the Tribunal directed the AO to restrict the addition to 20% of the total purchase amount, partially allowing the assessee's appeal.

A.Y.2005-2006 (Revenue's appeal):
The Revenue appealed against the deletion of an addition made on account of bogus purchases from R.R.Patel Trading Corporation. The Tribunal found that this issue was covered under the assessee's appeal for the same assessment year. The ground of the Revenue was dismissed.

A.Y.2006-2007 (Assessee's appeal):
The assessee challenged the addition made by the AO on purchases from R.R.Patel Trading Corporation. The Tribunal directed the AO to restrict the addition to 20% of the purchase amount, similar to the decision for the previous assessment year, partially allowing the appeal.

A.Y.2006-2007 (Revenue's appeal):
The Revenue appealed against the deletion of an addition made on account of bogus purchases from R.R.Patel Trading Corporation. The Tribunal found this issue was covered under the assessee's appeal for the previous assessment year. The ground of the Revenue was dismissed.

In conclusion, both the appeals of the assessee for A.Y.2005-2006 and 2006-2007 were partly allowed, while both the appeals of the Revenue for the same years were dismissed.