ITAT Mumbai Reduces Bogus Purchase Addition to 2% from 12.5%

Hasmukh Jagshi Visaria Vs ITO (ITAT Mumbai) Income Tax Appellate Tribunal (ITAT), Mumbai bench, has significantly reduced the rate of profit applied to alleged bogus purchases in the case of Hasmukh Jagshi Visaria. The Tribunal, hearing appeals for assessment years 2009-10 and 2011-12, directed the Assessing Officer (AO) to restrict the addition on account of unverified purchases to 2% of the bogus purchase value, a substantial reduction from the 12.5% confirmed by the Commissioner of Income Tax (Appeals) [CIT(A)] and the 100% initially added by the AO. The case originated when the assessee, a...