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2019 (12) TMI 314 - AT - Income TaxBogus purchases - Estimation of profit percentage - CIT(A) directed the AO to restrict the addition by estimating profit percentage at the rate of 3% on bogus purchases - HELD THAT:- The issue is decided in appellant own case POPATLAL N. SHAH 1802 VERSUS ACIT 19 (2) , INCOME TAX OFFICE, MUMBAI AND VICE-VERSA [2017 (11) TMI 1816 - ITAT MUMBAI], where it was held that CIT(A) had rightly appreciated that the addition in the hands of the assessee was liable to be restricted only to the extent of the profit element which was embedded in making of purchases from the open/grey market. Following the said decision, it can be safely concluded that the restriction placed by CIT(A) that the addition by estimating profit percentage at the rate of 3% on bogus purchases, is correct. Appeal of the assessee dismissed.
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