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2021 (4) TMI 235 - AT - Income TaxEstimation of income - Bogus purchases - HELD THAT:- AO has acknowledged the fact that the assessee has effected the corresponding sales and has also offered to tax the profit on such sales. In such circumstances, only the profit element embedded in the alleged non genuine purchase can be considered for addition. It is further noted by me, in assessee’s own case in assessment year 2011-12 on identical facts and circumstances the Assessing Officer had made disallowance at 12.5% of the non-genuine purchases which was sustained by learned Commissioner (Appeals). In further appeal the Tribunal [2019 (9) TMI 1509 - ITAT MUMBAI] taking note of the fact that the assessee is dealing in low profit margin items which attract lower rate of tax has restricted the disallowance to 5% of the alleged non genuine purchases. Admittedly, the aforesaid decision of the Tribunal was not available before Commissioner (Appeals) when she decided the appeal for the impugned assessment year. Be that as it may, after perusing the order of the Tribunal in assessee’s own case in AY 2011-12 (supra) find that the said decision has been rendered on identical facts and circumstances as involved in the present appeal. Therefore, respectfully following the decision of the coordinate Bench in assessee’s own case as referred to above, direct the Assessing Officer to restrict the disallowance to 5% of the alleged non genuine purchases. - Decided in favour of assessee.
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