INCOME TAX ACT, 1961

Section 69C

Income from undisclosed sources - Addition under section 69C - Purchases alleged as bogus on the basis of information emanated from investigation wing - Assessee discharged onus to prove purchases as genuine.

AO based on information emanated from investigation wing treated purchases claimed by assessee as bogus and made addition under section 69C to the extent of 25% of alleged purchases. Held: There is no dispute that onus was on the assessee to prove that purchases claimed by her were genuine. Assessee in support of her claim produced purchase bills issued by seller parties having details of their PAN, addresses, etc. Assessee also produced export invoices, export way bills/air way bills duly cleared by Customs Department. Therefore, sale of assessee which was the export was not doubted either by Customs Department or by AO. Assessee produced the ledger account of all the parties showing all the entries of purchases and payment through banking channel which was verifiable from the corresponding bank account details of assessee as well as the supplier concerns. These facts were not disputed by AO rather AO accepted that all the payments were made through banking channel. From Stock Register it was manifest that purchases made from concerned parties were duly reflected in the inward quantity and corresponding outward quantity was also reflected in the stock register which was on account of export. Also AO made addition of 25% of alleged bogus purchases which itself proved that AO himself had not considered all the purchases as bogus. Accordingly, when quantitative details of purchases and exports were matching as per the Stock Register and these quantities could be identified with purchases and concerend vouchers/bills, then assessee had prima facie discharged her onus to prove that purchases were genuine and addition under section 69C based on 3rd party information gathered by investigation wing could not be sustained as same was not subjected to independent verification by AO.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2009-10

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