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2021 (1) TMI 1063 - AT - Income TaxEstimation of income - Bogus purchases - assessee has failed to furnish stock register for the relevant period and the assessee has failed to produce the supplier before the AO - CIT-A sustained addition to 25% - HELD THAT:- Hon’ble Gujarat High Court in the case of CIT vs. Simit P. Sheth [2013 (10) TMI 1028 - GUJARAT HIGH COURT] has upheld the addition of 12.5% of the total amount of bogus purchases sustained by the ITAT, holding that, only profit element embedded in such purchases could be added to the income of the assessee.In the present case, the Ld. CIT (A) has sustained the addition of 25%, which is not in consonance with the judgment of the Hon’ble Gujarat High Court. No merit in the contention of the revenue that the Ld. CIT (A) ought to have sustained the addition made by the AO. The cases relied upon by the Ld. AR are distinguishable on facts and the ratio laid down in the said cases are not applicable to the present case. Hence, in our considered view, the addition of 12.5% is reasonable to meet the ends of justice. We therefore, modify the findings of the Ld. CIT (A) and restrict the addition to 12.5% of the total amount of bogus purchases determined by the AO.
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