Bogus Purchase Additions Restricted to Profit Margin: Bombay HC Ruling

PCIT Vs Mohommad Haji Adam & Co. (Bombay High Court) Bombay High Court in PCIT vs. Mohommad Haji Adam & Co. dealt with multiple appeals filed by the Revenue against a common judgment of the Income Tax Appellate Tribunal (ITAT). The core issue in all appeals was whether the ITAT was justified in not confirming the entire addition made by the Assessing Officer (AO) towards alleged bogus purchases shown by the assessee through accommodation bills issued by certain entities. The assessee, a trader in fabrics, had shown purchases worth approximately Rs. 29.41 lakh from three concerns — M/...