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2020 (8) TMI 470 - AT - Income TaxEstimation of profit from bogus purchases - unexplained expenditure - HELD THAT:- In this case, considering the nature of business of the assessee the AO has estimated 40.50% gross profit, which has been upheld by the ld. Ld.CIT(A). Although, both authorities have taken uniform rate of profit for estimation of income from alleged bogus purchase, but no one could support said rate of gross profit with necessary evidences or any comparable cases. Therefore, rate of profit adopted by the AO as well as the ld. CIT(A) seems to be on higher side when compared to nature of business of the assessee and hence, to settle dispute between the parties, we direct the ld. AO to estimate 12.50% gross profit on alleged bogus purchases. Appeal filed by the assessee is partly allowed.
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