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TMI Blog2023 (3) TMI 1402X X X X Extracts X X X X X X X X Extracts X X X X ..... t. No interference is called for in the said conclusion and findings of the Tribunal in the present appeal by this court. - HONOURABLE MR. JUSTICE N.V.ANJARIA AND HONOURABLE MR. JUSTICE NIRAL R. MEHTA MR. NIKUNT RAVAL WITH MRS KALPANAK RAVAL(1046) for the Appellant(s) No. 1 for the Opponent(s) No. 1 ORAL ORDER (PER : HONOURABLE MR. JUSTICE N.V.ANJARIA) Heard learned advocate Mr. Nikunt Raval with learned advocate Ms. Kalpana Raval for the appellant. 2. The present Tax Appeal filed under section 260A of the Income Tax Act, 1961, arises out of order dated 27.9.2021 of the Income Tax Appellate Tribunal, Surat in Income Tax Appeal No. 1152 of 2017 in respect of Assessment Year 2007-2008. 3. The facts are that the assessee is engaged in the bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee preferred Appeal No. 1379 of 2017. 3.4 The Tribunal restricted the addition to 6% of the disputed purchases shown by the assessee. 3.5 Seeking to call in question the aforesaid decision of the Tribunal, the department proposed the following questions, claiming to be arising as substantial questions of law, (i) Whether, on the facts and in the circumstances of the case and in law, the Tribunal was justified in estimating the addition in respect of bogus purchases at the rate of 6% of such purchases as against disallowance made by the AO at the rate of 100% of such purchases amounting to Rs. 4,34,00,343/- ignoring the fact that these purchases are sham transactions fabricated through bogus paper concerns of Bhanwarlal Jain Group companie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 Commissioner of Income Tax (Appeals), recorded thus, As held above, it is clear that the appellants have made purchases from elsewhere, but have obtained bills from the impugned suppliers. From the Trading P L account and Audit report it can be seen that the GP rate shown by appellant is 1.85% oil sales. In such circumstances the disallowance of 100% of purchases cannot be justified. Also as held above, the appellant would nave indulged in above practice in order to get some bene ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowance at 6%. In so concluding, the Tribunal observed in paragraph No.21 as under, .during the financial year under consideration the assessee has shown total turnover of Rs. 66,09,62,458/-. The assessee has shown Gross Profit @ 78% and net Profit @ 0.02% (page 11 of paper Book). The assessee while filing the return of income has declared taxable income of Rs. 1,81,840/- only. We are conscious of the facts that dispute before us is only with regard of the disputed purchases of Rs. 4.34 Crore, which was shown to have purchased from the entity managed by Bhanwarlal Jain Group. During the search action on Bhanwarlal Jain no stock of goods/material was found to the investigation party. Bhanwarlal Jain while filing return of income has offered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by it. No interference is called for in the said conclusion and findings of the Tribunal in the present appeal by this court. 6.1 The another weighing aspect is that the Tax Appeal No. 674 of 2022 in Principal Commissioner of Income Tax 1, Surat vs. M/s. Surya Impex which came to be decided by the co-ordinate Bench on 16.1.2023 dealt with the very issue of accommodation entries provided by Bhanwarlal Jain Group. The group involved in the said case is the same group who is saddled with allegations of providing accommodation entry to the assesse. In M/s. Surya Impex (supra) the court held in favour of the assessee. The questions of law involved in the said case were of the same nature and were in the context of similar facts involving the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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