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2024 (1) TMI 1065 - AT - Income TaxEstimation of income - Addition u/s 69C - bogus purchases of diamonds - HELD THAT:- We find force in the contention of the assessee that the Ld. CIT(A) erred in sustaining the 100% disallowance of purchases from M/s. Mohit Enterprises and thus, erred in confirming the addition u/s 69C of the Act. Therefore, as per the ratio laid down in Nitin Ramdeoji Lohia [2022 (11) TMI 480 - BOMBAY HIGH COURT] profit embedded in the transaction only need to be brought to tax particularly when the tax authorities have not disturbed the sales declared by the assessee in this year as well as balance shown as closing stock. And since we have noted that the assessee had itself offered gross profit of 3.95% this year and 17.59% in AY. 2014-15, therefore, in this year only profit element of gross profit @ 2% of the purchases from M/s. Mohit Enterprises would be just and reasonable and it is ordered accordingly. Appeal of the assessee is partly allowed.
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