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Facts
The Revenue appealed against the CIT(A)/NFAC's order concerning Assessment Year 2018-19. The CIT(A)/NFAC had restricted the disallowance of bogus purchases amounting to Rs. 36,07,392/- sourced from M/s Soni Textiles to 15%. The assessee did not appear for the hearing and was proceeded ex-parte.
Held
The Tribunal noted that the issue of bogus purchases has been decided with divergent views in various recent judicial precedents. After considering the facts and precedents, the Tribunal found no illegality or irregularity in the CIT(A)/NFAC's decision to restrict the disallowance to 15%.
Key Issues
Whether the CIT(A)/NFAC's decision to restrict the disallowance of bogus purchases to 15% was correct and whether the Revenue's appeal should be allowed.
Sections Cited
147, 144, 1961
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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. Satbeer Singh Godara
ORDER This Revenue’s appeal for Assessment Year 2018-19 arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2025-26/1083217935(1) dated 02.12.2025, in proceedings u/s 147 r.w.s. 144 of the Income Tax Act, 1961 (in short “the Act”).
Case called twice. None appears at the assessee’s behest. He is accordingly proceeded ex-parte.
Learned departmental representative vehemently argues during the course of hearing that the CIT(A)/NFAC has erred in law and on facts in restricting the Assessing Officer’s action disallowing the assessee’s entire bogus purchases of Rs.36,07,392/- sourced from M/s Soni Textiles to the extent of 15% thereof only in the impugned lower appellate discussion.
Azad Singh Ahlawat 4. That being the clinching factual position, the Revenue could hardly dispute that various recent judicial precedents (2025) 173 taxmann.com 592 (Guj.) Ravjibhai Becharbhai Dhamelia vs. ACIT; (2024) 160 taxmann.com 110 (Bom) PCIT Vs. Hitesh Mody (HUF), (2024) 160 taxmann.com 93 (Del) PCIT Vs. Forum Sales (P) Ltd.; (2025) 172 taxmann.com 283 (Bom) PCIT Vs. Kanak Impex (India) Ltd; (2025) 178 taxmann.com 424 (Del. – Trib.) DCIT Vs. Kohinoor Foods Ltd.; and (2025) 177 taxmann.com 836 (Delhi-trib.) DCIT Vs. Tirupati Matsup (P.) Ltd. have recently decided the instant issue of bogus purchases with divergent views as well. I thus find no illegality or irregularity in the CIT(A)/NFAC’s lower appellate discussion restricting the impugned bogus purchase disallowance only to the extent of 15% in very terms. Rejected accordingly.