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2020 (1) TMI 1218 - ITAT KOLKATARevision u/s 263 - Bogus purchases - PCIT’s revision directions that bogus purchase have to be disallowed @ 25% that @ 5% as per regular assessment in question - CIT-DR vehemently supported the PCIT’s action that the impugned disallowance has to be made @ 25% than @ 5% going by the his foregoing reasoning - HELD THAT:- We find no merit in Revenue’s instant argument. Case law quoted at the Revenue’s behest deals with bogus purchases whereas we are dealing with an instance of alleged inflated purchases between group concerns for the purpose and reducing gross profit rate. There is further no quarrel assessee’s sale purchase figures between the group concern have been accepted per se since the AO proceeded to disallow an estimated 5% inflated amount only. We conclude in this factual backdrop that the PCIT has erred in law and on facts in holding the AO’s regular assessment to this effect as an instance of outright bogus than inflated purchases. We according go by following settled legal proposition to hold that PCIT has erred in law and on facts in assuming his sec. 263 revision jurisdiction - The same stands reversed. - Decided in favour of assessee.
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