ITAT Mumbai: Bogus Purchases – Only 12.5% Profit Taxable, Full Disallowance Rejected

ITO Vs Rakesh Pruthaviraj Jain (ITAT Mumbai) In this case, the ITAT Mumbai upheld the CIT(A)’s decision to restrict addition on alleged bogus purchases (₹2.46 crore) to 12.5%, rejecting the Assessing Officer’s higher estimation of 25%. The Tribunal noted that the AO had relied solely on Sales Tax Department information and non-service of notices to suppliers, without conducting any independent enquiry or verification. At the same time, the assessee had furnished complete documentary evidence, including purchase bills, bank payments, VAT records, and stock details, which were not found to...