Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (10) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (10) TMI 739 - AT - Income TaxEstimation of income - GP ratio - Levy of penalty u/s 271(1)(c) - disallowance of expenses debited towards purchases u/s 40A(3) - Cash payment in excess of ₹ 10000/- - CIT(A) harboured a belief that total purchases made from these three concerns deserves to be treated as bogus and a disallowance is to be made. The ld.counsel for the assessee pointed out to us that if these purchases are being treated as bogus, then almost 40% of the purchases would be wiped out from the total purchases, and if that be so, then how the assessee would achieve the sale target accepted by the AO. Held that:- on the total turnover including the alleged bogus purchases, the assessee has already shown GP at the rate of 14.27%. If we further estimate 5% to 6% more than the GP on the total turnover including the alleged bogus purchase would be more than 20%. This will meet ends of justice. Levy of penalty - Held that:- on the basis of circumstantial evidence, it has been concluded that the purchases made by the assessee to some extent are non-genuine, and therefore profit element involved in such purchases deserves to be assessed as income of the assessee. Respectfully following the judgment of Hon’ble jurisdictional High Court we allow this appeal of the assessee and delete the penalty.
|