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2021 (2) TMI 418 - AT - Income TaxEstimation of income - Bogus purchases - Specific information received from the Sales Tax Department to indicate that certain purchases made by the assessee were non-genuine - Commissioner (Appeals) restricted the additions to 12.5% - HELD THAT:- As assessee failed to conclusively prove the fact that the purchases were made from the declared source. However, considering the fact that the assessee has effected corresponding sales, doubt was only with regard to the source of purchases. For this reason alone, the Assessing Officer has estimated the profit element embedded in non-genuine purchases @ 25% and learned Commissioner (Appeals) has restricted to 12.5%. This is solely for the reason that the assessee must have purchased the goods from unverified sources/grey market by not paying VAT and thereby suppressing the true profit. Considering the nature of business of the assessee and the profit rate generally adopted by the Tribunal in such type of cases no infirmity decision of learned Commissioner (Appeals) in restricting the addition to 12.5% of the alleged non genuine purchases. Therefore, the grounds raised in all these appeals are dismissed.
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