Case Law Details
ITO Vs Vimalchand Manikchand Jain (ITAT Surat)
Held that if the parties are failed to prove the genuineness of entire transaction of such tainted purchases, the revenue authorities are not entitled to bring the entire transaction to tax. Authorities can tax the income component in such tainted transactions
Facts-
Based on information, AO carried search action on Rajendra Jain. In his statement, Rajendra Jain confirmed that he was managing various bogus entries for providing accommodation of entry without delivery of actual goods. AO noted that assessee was one of the beneficiaries of such purchases. Accordingly, notice u/s 148 was issued.
On the basis of modus operandi of practice of Rajendra Jain, AO treated 25% of relevant purchase as bogus and disallowed the same.
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