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2018 (11) TMI 997 - AT - Income TaxBogus purchases - estimation of income - Held that:- It is quite just and fair to estimate the probable inflation in cost of purchase to artificially reduce probable profits for the purposes of taxation. The CIT(A) has made such estimations at 20% of the value of alleged bogus purchases. Keeping in mind the total absence of direct evidences to support the purchases, we are of the opinion that such estimations are quite low. The assessee is engaged in construction activity where the profits vary widely and are not generally comparable. Taking guidance from the decision of the Hon’ble Gujarat High Court in the case of Vijay Proteins Ltd.[2015 (1) TMI 828 - GUJARAT HIGH COURT] and Sanjay Oil Cake Industries (2008 (3) TMI 323 - GUJARAT HIGH COURT) the fair estimate in our view would be 25% of the alleged bogus transactions, profits to which extent is deemed to be suppressed. Therefore, we consider it expedient to modify the estimation made by the CIT(A) to 25% in place of 20%. - Appeal of the Revenue is partly allowed
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