In one of my scrutiny assessment,assessee as around 4 lacs creditors which are not confirming say bogus (Purchase bills were fake) and likewise 3 lacs debtors (bogus) (here also sales bill was fake).
What will be addition 4 lacs or 7 lacs or 1 lacs.My contention with A.O.is that addition should be 1 lac (net of creditors & debtors)
29 September 2008
If the purchase bills are fake it will be straightaway added back to income. If sales bills are fake it will be very difficult to convince the authorities that they are fake.
Therefore the addition will be Rs. $ lakhs in my opinion.
CAclubindia
