2023 (2) TMI 299 - AT - Income Tax

Estimation of income - bogus purchases - CIT-A restricted addition to the extent of 5% of entire purchase - HELD THAT:- We note that issue is squarely covered by the judgment of the Co-ordinate Bench in the case of Pankaj K. Chaudhary [2021 (10) TMI 653 - ITAT SURAT]

We note that out of total addition of Rs.3,28,72,462/-, the amount pertaining to M/s Krishna Diamond Pvt Ltd (unsecured loan) to the tune of Rs.43,06,094/- should be excluded, as it does not pertain to bogus purchases, therefore we direct the Assessing Officer that no addition should be made on the amount pertaining to M/s Krishna Diamond Pvt. Ltd. (unsecured loan) to the tune of Rs.43,06,094/- . However in respect of remaining parties viz: M/s Karishma Diamonds Pvt. Ltd. to the tune of Rs.78,65,729/-, M/s Parshwanath Gems Pvt. Ltd. to the tune of Rs.1,87,00,651/-, and M/s. Mihir Diamond to the tune of Rs.19,99,988/-, totalling of these three parties comes to Rs.2,85,66,368/-, therefore we direct the Assessing Officer to sustain the addition at the rate of 6% - Appeal filed by the Revenue is partly allowed.