TMI Blog2012 (8) TMI 1170X X X X Extracts X X X X X X X X Extracts X X X X ..... rcumstances of the case and in law, the learned CIT(A) erred in upholding the validity of the order passed U/s.158BD of the I.T. Act and that too without giving full and proper opportunity of being heard in the matter. 3. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in upholding the validity of the order passed U/s.158BD of the I.T. Act and that too without even appreciating fully and properly the facts of the case. 3. At the time of hearing, the AR appearing on behalf of the assessee company conceded grounds no. 1 to 3 as not pressed. Since the grounds are not pressed, the same are dismissed. 4. Grounds no. 4 5 are interlinked, in a way that the AO had estimated the un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... added back the aggregate of such entries as bogus investments, on account of hawala accommodation. The DR submitted that in fact, the CIT(A) has favoured the assessee by reducing the disallowance from ₹ 10,46,490 to ₹ 2,61,627 only, besides adding the GP at 5% on ₹ 10,46,490. 7. We have heard the rival contentions and have also perused the orders of the revenue authority and the material placed before us. This is a case of assessment of a connected person, whose records had been found in the cource of search proceedings of another person. Because of this reason, special provisions under Chapter XIVB has to be applied on such connected person. The fact that NSMPL, NSCPL and CLRPL were subjected to search u/s 132 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it shows that there can be no question of making any addition on account of initial investment at the rate of 25% of the purchases. This addition would have been valid if the assessee had not recorded any purchases in the books of account and had effected sales outside the books. We, therefore, order for the deletion of addition of ₹ 2,61,627, being investment at the rate of 25% of total purchases. 9. Insofar as the application of additional gross profit rate of 5% is concerned, we are fully with the Revenue because there could have been no other possible reason to incorporate bogus purchases in the books of account except for making cheap purchases from the market and recording bogus purchases at higher level. Since the Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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