INCOME TAX ACT, 1961

Section 69C

Income from undisclosed sources - Addition under Section 69C - Bogus purchases - Assessee failed to file any evidence and proof of transportation of goods to assessee's factory and also evidence of transport expenses incurred against those purchases

AO received information from Addl. CIT as to assessee having obtained accommodation purchase bills. AO required assessee to justify purchases from the concerned parties. Assessee explained that these purchases were genuine in view of copy of bills, goods received notes (GRN), orders placed on the brokers for supply of goods, payments made by account payee cheque. AO rejected this on the ground that assessee failed to file any evidence and proof of transportation of those goods to assessee's factory and also failed to file evidence of transport expenses incurred against those purchases. Held: Mere filing of copy of purchase bills, goods received notes or payment by cheque was not sufficient to establish the purchases. Assessee was required to discharge its onus of substantiating the purchases with deliveries of goods. Responsibility of assessee to substantiate purchases was further increased in view of statement of seller party that he had provided accommodation entry bills without supplying the goods physically. Accordingly, in view of failure on part of the assessee in discharging its onus, AO was justified in making addition under section 69C.

REFERRED :

FAVOUR : Against the assesse

A.Y. :

SUBSCRIBE FOR FULL CONTENT

OR Try Reload the Page