Case Law Details
Bhavesh Punmaji Devasi Vs ITO (ITAT Mumbai)
ITAT Mumbai held that 100% addition in case of bogus purchases unsustainable. Notably, addition to the extent of rate of gross profit in case of bogus purchase is duly sustained.
Facts- The assessee is an individual running a proprietary concern in the name and style of Bhavik Metal, engaged in the business of trading in ferrous and non-ferrous metals.
Based on the information from Sales Tax Department and Directorate General of Income Tax (Investigation), Mumbai [DGIT (Inv.)] that the assessee is one of the beneficiaries of the bogus purchase bills during the year under consideration, the assessment was reopened by initiating the proceedings under section 147/148 of the Act.
As per information received from office of DGIT (Inv.), Mumbai the assessee has taken entries of bogus purchases totaling amount to Rs. 58,69,921/-. CIT(A) dismissed the appeal ex-parte by making 100% addition of Rs. 58,69,921/- on account of bogus purchase.
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