INCOME TAX OFFICER 32 (1) (2), MUMBAI vs. SHRI CHIRANJILAL B SHAH, MUMBAI

आअसं. 5791/मुं/2019 (िन.व.2009-10) (A.Y.2009-10) 2. Sh. Sanjay J. Sethi representing the Department submitted that during the period relevant to the Assessment Year (AY) under appeal, the assessee had obtained bogus purchase bills amounting to Rs. 1,64,732/- from three dealers, declared as hawala operators by the Sales Tax Department, Government of Maharashtra. During assessment proceedings, the assessee neither produces the said dealers nor any confirmations from them were filed. No document was furnished by the assessee to prove trail of goods. Thus, the assessee failed to discharge his onus in proving authenticity of the dealers and the purchases made from them. The Assessing Officer (AO) after considering the entire facts estimated Gross Profit (GP) @ 20% on bogus purchases and made addition of Rs. 32,946/-. In First Appellate proceedings, the CIT(A) restricted the addition to 10% of the bogus purchases. The ld. DR prayed for restoring the findings of AO.

On the other hand, Sh. Sanjay Bhachawat appearing on behalf of the assessee submitted that the assessee is engaged in the business of manufacturing and selling of rubber goods. During the course of assessment proceedings, the assessee had furnished the name, addresses and TIN of the alleged suspicious dealers. The assessee had also furnished copies of the invoices, delivery challanes, bank details to discharge his onus in proving genuineness of the alleged suspicious dealers and purchases made from them. Despite the evidences furnished by the assessee, the AO held the purchases from the aforesaid dealers as bogus and estimated GP addition of 20%, the CIT(A) has restricted to 10%. The assessee has accepted the same and is not in appeal against the findings of CIT(A), although the assessee had furnished the documents to prove genuineness of the purchases.