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2017 (5) TMI 915 - ITAT MUMBAIEstimation of possible profit out of purchase made through non-genuine parties - Held that:- We found that in the instant case stock and sales and the quantity-wise stock and purchases / sales were tallied to the last KG therefore, we directed to take the A.O. 12% of the sales as gross profit accordingly re-compute the business of the assessee. We find that CIT(A) has directed to take the G.P. @ 10% of the sales but to cover up all the decisions of the books of accounts. We modify the order of the CIT(A). We direct him to take the 12.5% sales gross profit accordingly the Departmental appeal is partly allowed. Outstanding Sundry Creditors - addition u/s 41 - Held that:- We find that the A.O. observed that the assessee ask to fail the confirmation in respect of outstanding Sundry Creditors but the assessee failed to file the confirmation letter the non-filing confirmation as the supplier were from abroad and the Assessing Officer was of a view non-filing of confirmation attracts provision of Section 41(1). We find that in the case of ITAT Mumbai in case of Maharashtra State Co-operative Consumer Federation [2011 (8) TMI 258 - ITAT MUMBAI] wherein it is held that in absence of contrary material placed by the Revenue for no such liability exist in the books of account or the assessee has obtain any benefit by case or any other manner merely because said liability was more than 5 years old it cannot be said that there was cessation of liability. Therefore, we are of the view that CIT(A) is justified in deleting the same. - Decided in favour of assessee.
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