100% disallowance for bogus purchase cannot be done if Sales not doubted

Ashok Popatbhai Chaudhari Vs ITO (ITAT Mumbai) The Income Tax Officer in this case has made 100% addition on account of bogus purchase resulting in disallowance of Rs. 56,085/-. Upon assessee’s appeal ld. CIT(A) confirmed the same. It is settled law that when sales are not doubted, 100% disallowance for bogus purchase cannot be done. The rationale being no sales is possible without actual purchases. This proposition is supported form Hon’ble jurisdictional High Court decision in the case of Nikunj Eximp Enterprises (in Writ Petition No. 2860, order dated 18.06.2014). In this case the Honâ€...