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2017 (7) TMI 1103 - AT - Income TaxEstimating the profit @3% of bogus purchases - Held that:- The case relates to the purchases of precious, semi-precious diamonds and gem stones and in this context the Assessing Officer as well as CIT(A) have not estimated the profit at the level which is normally done in similar cases involving products like metals, ferroalloys, etc. Reasonableness of the estimation by the CIT(A) is concerned, it is seen though she has recognized the presumptive rates recommended by the Task Force set up by the Central Government for business of manufacturing and/or trading of diamonds, but has not been fully guided by it. Considering the recommendations and the fact that there is a mix of trading as well as manufacturing in the case of the assessee, a rate of 2.5%, as recommended by the task force would be more appropriate and justified to ascertain the profit on the unsubstantiated purchases. Appeal of the assessee partly allowed.
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