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2021 (10) TMI 258 - AT - Income TaxEstimation of income - Bogus purchases - CIT(A) restricting the addition on account of profit element at the rate of 2.42% of the alleged bogus purchases from tainted parties - DR argued that the learned CIT(A) ought to have estimated the profit at the rate of 12.5% of the value of purchases which has been consistently made by this Tribunal in various other cases - HELD THAT:- Assessee is engaged in iron and steel industry and moreover, assessee is only a trader in Iron and Steel. Assessee has disclosed gross profit of 2.42% in its books which has been accepted by the Revenue. It is not in dispute that sales made out of the purchases of ₹ 1,75,16,051/- from seven parties has not been doubted by the Revenue. For the purpose of determining the profit element embedded in the value of such purchases, taking into consideration the industry in which the assessee is dealing with, we deem it fit appropriate to estimate the profit at 5% of the value of such purchases as income of the assessee, which in our considered opinion, would meet the ends of justice. Appeal of the Revenue is partly allowed.
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