The assessee declared purchases from parties issuing bogus purchase vouchers without actual...

The assessee declared purchases from parties issuing bogus purchase vouchers without actual transactions, merely laundering unaccounted money to claim deduction u/s 80HHC. The Assessing Officer treated 25% of unverifiable purchases as income from other sources, alleging inflation of export profits. The CIT(A) confirmed this addition. The ITAT held that rejection of books u/s 145(3) requires specific conditions, which were not satisfied. The AO did not follow the proper procedure or point out defects in accounts. The ITAT relied on judicial precedents to conclude that no addition can be made if the declared gross profit rate is higher than the rate prescribed by the jurisdictional High Court in such cases. The assessee's gross profit rate wa..... .....

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