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TMI Blog2018 (1) TMI 1317X X X X Extracts X X X X X X X X Extracts X X X X ..... otality, we are of the opinion that it would be reasonable and fair to make an addition of 2.5% of the bogus purchases to the income of the assessee. Accordingly, we direct the AO to add 2.5% of the bogus purchases by setting aside the order of the CIT(A). X X X X Extracts X X X X X X X X Extracts X X X X ..... his party and corresponding sales were also made during the year or in the subsequent year which were duly recorded and shown in the books of accounts. However the reply of the assessee did not find favour with the AO who added the entire purchases from M/s. Kinjal Industrial Corporation to the tune of Rs.1,77,41,902/- to the income of the assessee on the ground that the principal officer of M/s. Kinjal Industrial Corporation admitted in his statement recorded under Section 131 of the Act that the said concern was involved in providing accommodation bills to various parties without delivering any goods physically in consideration of certain commission. Finally the assessment was framed under Section 143(3) r.w.s. 147 of the Act vide order d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act that the said concern was engaged in the business of providing accommodation entries of purchases for which commission was charged without supplying any material physically. The learned D.R. also submitted that the assessee has failed to produce the parties before the AO and therefore the said purchases could not be confirmed. The learned D.R. contended that the order of the CIT(A) being incorrect and against the facts on record should be reversed and that of the AO be upheld. 6. Per contra the learned A.R. relied heavily on the order of the CIT(A) by submitting that the assessee has placed all the necessary records available with it regarding the purchases comprising bills, vouchers, copy of ledger accounts, evidence of payment, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... als/goods. During the year the turnover the assessee was ₹ 93.48 crores whereas the purchases were to the tune of Rs.90 crores and the G.P. declared was 3.05%. Upon being called upon, the assessee filed all the details comprising bills, vouchers, copy of ledger accounts, evidence of payment, bank statement and evidence of sales in the books of the assessee before the AO but AO simply relied on the statement of the principal officer and did not carry out any further verification and thus not discharging the onus upon him. Thus, it is correct that the AO has not carried out any further investigation to bring out the truth and also not disputed the sales by the assessee out of said purchases. The learned CIT(A) has deleted the addition o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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