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2021 (10) TMI 948 - AT - Income TaxEstimation of income - Bogus purchases - CIT-A estimation of income @12.5% on the genuine transactions of purchases - HELD THAT:- Gross profit rate disclosed in the financial statement is @3.25% and the assessee is in the Civil construction business and the margin of profit as mentioned by the AR is comparatively very much lower than 12.5% estimated by the CIT(A) - Accordingly, to meet the ends of Justice, we restrict the profit percentage to 6% as against 12.5% and modify the order of the CIT(A) - we make it clear that this reduced percentage is applicable only to the AY. Reopening of assessment u/s 147 - Estimation of commission - HELD THAT:- We are of the opinion that the A.O. has only estimated the commission payment without any evidence and the addition was solely made on the basis of statement recorded - the addition is without evidence and the revenue has not discharged the burden with any incriminating material and we direct the AO to delete the addition and allow this ground of appeal - appeal of validity of re-assessment proceedings, we find the reopening was made with proper information from DCIT(Central circle) and we are not convinced with submissions of the AR and we dismiss this ground of appeal of the assessee. Gross profit/ profit embedded in the non genuine purchases and has restricted the addition to the extent of 12.5% of bogus purchases - AO has not doubted the sales and we rely on the ratio in the case of M/s Nikunj Eximp Enterprises [2014 (7) TMI 559 - BOMBAY HIGH COURT] - we are not inclined to interfere with the order of the CIT(A) and uphold the same and dismiss the grounds of appeal of the revenue.
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