#Section 69C IT Act

The ITAT Bangalore has ruled that the Assessing Officer cannot impose ad hoc disallowance under Section 69C when audited books of account substantiate genuine purchases from agriculturists, even in the absence of PAN details. This sets a critical precedent for small traders and farmers' suppliers, affirming that procedural compliance cannot override substantive verification of transaction authenticity.

The ITAT Kolkata has set aside an ex parte income tax assessment under Sections 69A and 69C, holding that the right to fair hearing is non-negotiable under natural justice-even when delay in filing an appeal is contested. This ruling reinforces that suspicion alone cannot substitute evidence, and reassessment must be conducted afresh with full opportunity to the assessee.

ITAT Delhi ruled that when goods purchased under suspicion of fictitious transactions are fully returned, the purchase claim is extinguished - only the retained stock (Rs.26 lakh) attracts a 15% gross profit addition under Section 69C. This clarifies that genuine returns, even after delay, rebut the presumption of bogus purchases, offering critical relief to traders facing speculative tax assessments.

ITAT Nagpur rules that additions under Sections 68 and 69C for long-term capital gains from listed shares cannot be sustained without concrete evidence disproving the genuineness of transactions. The tribunal emphasizes that mere suspicion cannot override documentary proof, setting a precedent for tax assessments involving LTCG claims.

The ITAT Ahmedabad struck down a reassessment under Section 147 because the Assessing Officer relied solely on uncorroborated investigation reports from a third party’s search, without establishing that the assessee had actually concealed material facts. This ruling reinforces that tax authorities cannot substitute their own speculative inferences for concrete evidence, protecting assessees from arbitrary additions under Section 69C based on hearsay or borrowed conclusions.

The ITAT Delhi has ruled that an investigation wing’s report identifying a company as bogus is insufficient to sustain additions under Sections 68 and 69C unless corroborated by independent, verifiable evidence such as bank trails, stock records, or third-party confirmations. This reinforces the burden of proof on the Revenue and protects taxpayers from speculative assessments based solely on departmental assertions.

ITAT Delhi rules that if sales are accepted but purchases are alleged to be bogus, disallowance under Section 69C must be restricted to the gross profit margin rather than the entire purchase value. The ruling reinforces judicial precedent, protecting assessees from excessive additions where sales legitimacy is not challenged.

ITAT Delhi holds that payments to paper entities for bogus purchases are taxable as unexplained expenditure under Section 69C in the year of payment, not the year of original purchase.