9911796707
TMI Blog2024 (6) TMI 1226X X X X Extracts X X X X X X X X Extracts X X X X ..... It is not the claim of the learned assessing officer that the purchases shown by the assessee are not at market rate. It is claimed by the assessee that above amount is also standing in the books of accounts in the closing stock at the same rate. Therefore, only the appropriate amount of the gross profit involved in the above transaction needs to be added to the total income of the assessee. As there is no information available with the assessing officer due to non-compliance by the assessee, non-compliance before the CIT appeal and also not producing any details except written submission before us, we are constrained to adopt 12.5% of the bogus purchases as income of the assessee. Accordingly the AO is directed to restrict an addition of 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as preferred this appeal raising following grounds i. That on the facts and in the circumstances of the case and as well as in the law the appellate order passed by the learned CIT (A) dismissing the appeal of the appellant is wrong, unjustified, invalid and bad in law. ii. That on the facts and in the circumstances of the case as well as in law, the learned CIT (A) has erred in upholding the addition of ₹ 980,000 by treating the genuine and duly accounted for purchase as bogus and added under section 69C of the act. The addition so made by the learned AO and sustained by the learned CIT (A) is wrong and unjustified. The appellant prays for deleting the same. iii. That on the facts and in the circumstances of the case as well as in la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to the directors on 15/9/2017. As there is no response, further notice was also sent on 9/10/2017 to the directors of the company on their address at Surat calling for certain details. This notice was also not responded. The learned assessing officer issued a further notice to the directors of the company providing the reasons recorded as well as the statement of one accommodation entry provider Mr. Prafull Ishwarbhai Patel. In response to the above show cause notice on 18/11/2017 the assessee furnished reply stating that assessee has made purchase of ₹ 980,000 from Ankita enterprises and assessee supported the same by the Ledger account, purchase invoices, and details of assessee of income tax return, computation of income and annu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... act. 5. The assessee aggrieved with the assessment order preferred an appeal before the learned CIT A wherein the learned CIT A issued seven notices to the assessee and none of these notices were complied with. Therefore by order passed by the learned CIT A the addition made by the AO was confirmed. 6. Aggrieved by that appellate order the assessee preferred an appeal before us. Despite notice none appeared on behalf of the assessee, assessee has submitted a written reply, and therefore the issue needs to be decided on the merits of the case considering those written replies. 7. The learned departmental representative vehemently supported the order of the lower authorities and submitted that the assessee has not furnished any information a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payment have been made to these parties through account payee cheque. It was the claim of the assessee that assessee has incurred losses of ₹ 3,795,790/ and therefore there is no reason to obtain any bogus purchases bill by the assessee. It was further stated that the addition has been made on the basis of the statement of third party itself and therefore such addition cannot be sustained. Assessee relied on several judicial precedents. In the end it was submitted that the entire purchases cannot be added but only the profit embedded in such purchases can at the most be added and further the addition is beyond the scope of section 69C of the act. It was also the claim of the assessee that the reassessment proceedings are taking place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e cheque. Quantity of purchases in the above transaction is shown by the assessee stated to be in closing stock and valued at the same rate. Assessee has stated that it has the closing stock of ₹ 1.35 crores. It is not the claim of the learned assessing officer that the purchases shown by the assessee are not at market rate. It is claimed by the assessee that above amount is also standing in the books of accounts in the closing stock at the same rate. Therefore, only the appropriate amount of the gross profit involved in the above transaction needs to be added to the total income of the assessee. As there is no information available with the assessing officer due to non-compliance by the assessee, non-compliance before the CIT appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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