Case Law Details
Bhagatram Vs ACIT (ITAT Hyderabad)
The issue under consideration is whether the CIT(A) is correct in considering the entire purchase as bogus purchase?
ITAT states that it is also a known fact that Gold / Gold Jewellery is often purchased in the grey market in order to avoid taxes/customs duty etc., by the traders. In this situation, the onus is on the assessee to establish the genuineness of the suppliers. Though the payment made by the assessee towards the purchases are through banking channels, it is also revealed that the suppliers were issuing bogus bills and vouchers to various parties. In this situation, producing the bills and vouchers and evidencing the payment made through cheque alone will not establish that the transactions are genuine. However, ITAT is of the view that the order of the Ld. CIT (A) to enhance the addition by treating the entire bogus purchases as the income of the assessee is not appropriate because it is evident that the assessee had made purchases apparently from his accounted money as the payments have made through banking channels. Further it is also a fact that the Gold/Jewellery purchased are either sold by the assessee or remains with the assessee as his closing stock, since there are no other contrary findings by the Revenue. Therefore, ITAT hereby set aside the order of the Ld. CIT (A) and confirm the order of the Ld. AO.
FULL TEXT OF THE ITAT JUDGEMENT
This appeal filed by the assessee aggrieved by the order of the Ld. CIT (A)-4, Hyderabad in appeal no.0333/16-17/ACIT, Cir.5(1)/CIT(A)-4/Hyd/18-19, dated 21/6/2018 passed U/s 250(6) r.w.s 147 & 143(3) of the Act for the AY 2009 -10.
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