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TMI Blog2024 (3) TMI 1012X X X X Extracts X X X X X X X X Extracts X X X X ..... e present case, we deem it appropriate to restrict the disallowance to 5% of the disputed purchases in the year under consideration. As a result, grounds raised by the assessee on merits are partly allowed. - Shri Prashant Maharishi, Accountant Member And Shri Sandeep Singh Karhail, Judicial Member For the Assessee : Shri Nishit Gandhi For the Revenue : Shri H.M. Bhatt ORDER PER SANDEEP SINGH KARHAIL, J.M. The present appeals have been filed by the assessee challenging the separate impugned order of even date 29/08/2023 passed under section 250 of the Income Tax Act, 1961 ( the Act ) by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [ learned CIT(A) ], for the assessment years 2007-08, 2009-10 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ases made by the Appellant are genuine and duly explained byall the necessary documents, vouchers and evidences in this regard and in fact no fault has been found with the same by the Ld. AO himself; b. The disallowance could be made only after deducting therefrom the GP already offered to tax by the Appellant; and; c. Without prejudice to the above, even as per the report of the Financial Action Task Force appointed by the Government, the maximum profit attributable to the business as carried on by the Assessee is in the range 1 to 3% and the disallowance must be restricted to the said percentage of purchases. D. Without further prejudice to the above, the Appellant humbly submits that the disallowance, if at all required to be made, must ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of bills. In response thereto, the assessee submitted that the purchases made are genuine in nature and also contended that the purchases made from these parties have been duly entered in the books of account and payments have been made through cheques only. The Assessing Officer ( AO ) vide order dated 27/03/2015 passed under section 143(3) read with section 147 of the Act did not agree with the submissions of the assessee and held that barring the stock register entry and cheque payment, custom appraisal report in respect of export sales no other documents such as delivery challans, etc. were produced during the course of assessment proceedings. Accordingly, the AO held that this leads to prove that the purchases shown to have been made b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d polished diamonds, gold and silver, precious and semi- precious stones. Further, it is the claim of the assessee that the assessee has purchased cut and polished diamonds, and all the payments were made by account payee cheque. However, we find that before the lower authorities, the assessee could not prove the genuineness of the transaction with sufficient documentary evidence. From the material available on record it is evident that the assessee has failed to prove the genuineness of the purchases made from the supplier. However, at the same time, it is evident from the record that the Revenue has not doubted the sale of diamonds by the assessee. Further, it cannot be doubted that without the purchase of diamonds, the assessee cannot ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed. 8. In the result, the appeal by the assessee is partly allowed. ITAs no.3624 and 3625/Mum./2023 Assessee s Appeals - A.Ys. 2009-10 and 2012-13 9. Since in the assessment years 2009-10 and 2012-13 the impugned addition pertains to disallowance on account of alleged bogus purchases from the entities controlled by Mr. Bhanwarlal Jain and his group, therefore our findings/conclusions rendered in assessee s appeal for the assessment year 2007-08 shall apply mutatis mutandis. Accordingly, the disallowance in respect of disputed purchases is restricted to 5%. As a result, grounds raised by the assessee on merits are partly allowed. In the appeal for the assessment year 2009-10, ground challenging the invocation of proceedings under section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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