Where the assessee had opted for presumptive taxation under section 44AD, the AO could not make an addition on account of alleged bogus purchase since the assessee was under no obligation to explain individual entries of purchase.

34. (2025) 175 taxmann.com 996 (Ban Trib)

Lakshmanram Bheemaji Purohit vs. ITO

ITA No.: 196/Bang/2025

A.Y.: 2018-19 Dated: 25.06.2025

Sections 44AD, 69C

Where the assessee had opted for presumptive taxation under section 44AD, the AO could not make an addition on account of alleged bogus purchase since the assessee was under no obligation to explain individual entries of purchase.

FACTS

The assessee was an individual engaged in the business of trading of waste home products. He filed his return of income on 08.08.2018 declaring total income of ₹5,87,014 as per provisions of section 44AD.

Information was received by the AO that assessee had received bogus purchase bill of ₹16,09,692 from one M/s. ARS Enterprises. It was alleged that this was a bogus tax invoice wherein false input credit was claimed under GST. Assessee was asked to furnish the details. Assessee submitted that he had filed return of income under section 44AD and therefore the details of purchases were not maintained. He also submitted a chart showing the purchase of go