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2016 (7) TMI 1314 - AT - Income TaxUnexplained expenditure in purchases towards the clandestine sales of steel bars - G.P. determination - Held that:- Clandestine removal of goods without payment of Excise duty to the extent of ₹ 30,62,540/-. Assessing Officer is directed to compute the income in the hands of assessee by applying GP rate at 4% on said value of ₹ 30,62,540/- or by applying higher GP rate, if any, so declared by the assessee. However, no addition was made under section 69C of the Act on account of undisclosed purchases on items utilized for the manufacture of TMT bars. It may be kept in mind that the assessee has already declared ₹ 1,62,315/- as income from other sources by taking the gross profit at 5.3%. Further, the assessee had declared ₹ 36,785/- as additional income, which may be verified by the Assessing Officer as per directions. In view thereof, there is no merit in the order of enhancement passed by the CIT(A) by taking the total purchases as income from other source. - Decided in favour of assessee.
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