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TMI Blog2017 (12) TMI 1759X X X X Extracts X X X X X X X X Extracts X X X X ..... directed against the order dated 02-03-2017 passed by Ld CIT(A)-37, Mumbai and they relate to the assessment year 2007-08. The revenue is aggrieved by the decision of Ld CIT(A) in partially confirming the addition relating to bogus purchases. 2. In the cross objection, the assessee is aggrieved by the decision of Ld CIT(A) in confirming the validity of reassessment proceeding and also in partiall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave been exported. Hence the Ld CIT(A) took the view that the profit element embedded in the transaction alone can be added. The Ld CIT(A) noticed that a task force group of diamond industry, after considering Benign Assessment Procedure, recommended presumptive tax of 2% for trading activity and 3% for manufacturing activity. The Ld CIT(A) also took note of the fact that the Transfer Pricing wing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also the decision rendered in the case of Sanjay Olicake Industries (316 ITR 274) to come to the conclusion that the profit element embedded in the purchases could be assessed. Since the purchases have been made from a group, which had taken a different stand, the Ld CIT(A) took the view that there is possibility of inflation of purchase price, from which the assessee could have made profit. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he facts and has rendered his decision. Accordingly I uphold the order passed by Ld CIT(A) on this issue. 7. The assessee has challenged the validity of reopening of assessment. I notice that the AO has reopened the assessment on the basis of information received, which led him to believe that there was escapement of income. Hence I am of the view that the reopening was valid in law. The order gr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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