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2018 (6) TMI 1183 - AT - Income TaxEstimation of profit element embedded in bogus purchases - Held that:- Hon’ble Gujarat High Court in the case of CIT vs Simit P Sheth [2013 (10) TMI 1028 - GUJARAT HIGH COURT] observed that no uniform yardstick could be adopted for estimation of profit on bogus purchases. In case of bogus purchases, only profit element embedded in such purchases needs to be taxed but not total purchases that too, when assessee has filed certain evidence to justify such purchases and also where the AO has not doubted sales declared by the assessee and not pointed out any mistakes in books of account maintained for the financial year. We direct the AO to estimate net profit of 12.5% on total alleged bogus purchases from mentined two parties.
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