ITAT deletes penalty on estimated addition for alleged bogus purchases

Mukesh Shaligram Sharda Vs ITO (ITAT Mumbai) If sales are not disputed, entire alleged bogus purchases cannot be disallowed and only the gross profit on the alleged purchases to be disallowed. No penalty under section 271(1)(c) is leviable on estimated additions. It is undisputed fact that impugned penalty was levied only on estimated addition. The Assessing Officer had made addition of entire bogus purchases, however, did not doubt the sales made against such purchases. We observe that the Tribunals in various decisions have held that where sales are not disputed, entire alleged bogus purchas...