ITAT confirms Penalty on admitted bogus purchase to Inflate work in progress

Centaur Mercantile P. Ltd. Vs ACIT (ITAT Mumbai) It is undisputed that the assessee has booked bogus purchases thereby inflating work-in-progress. Hence, it is clear that the assessee was owner of undisclosed income during the year. It was because of the system of accounting followed by the assessee being percentage completion method, that there was no change in the figure of income offered in the year. However, the resultant impact of bogus purchases resulting in bogus inflation of work-in-progress was subsequently reversed and given effect in A.Y. 2011-12, in which year there was increase in...