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TMI Blog2019 (4) TMI 1878X X X X Extracts X X X X X X X X Extracts X X X X ..... y of reassessment proceedings u/s 147, however, these grounds have not been pressed during hearing before us. Therefore, the same are not considered while adjudicating the appeal. 2.1 The assessment for impugned AY was framed by Ld. Income Tax Officer-9(1)(4), Mumbai [AO] u/s 143(3) read with Section 147 of the Act on 23/03/2016 wherein the income of the assessee was determined at Rs. 114.92 Lacs after certain additions as against returned income of Rs. 42.87 Lacs e-filed by the assessee on 30/09/2011 which was processed u/s 143(1). The estimated addition of Rs. 72.03 Lacs on account of alleged bogus purchases is the sole subject matter of present appeal before us. The assessee being resident corporate assessee was stated to be engaged in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rchases @12.5% in terms of the judgment of Hon'ble Gujarat High rendered in CIT Vs. Simit P.Sheth [356 ITR 451]. The same resulted into impugned addition of Rs. 72.03 Lacs in the hands of the assessee. 3. The assessee agitated the reassessment proceedings on legal grounds as well as quantum additions on merits, however without any success, before Ld. first appellate authority vide impugned order dated 30/11/2018 wherein the stand of Ld. AO was confirmed. Aggrieved, the assessee is in further appeal before us. 4. The Ld. Authorized Representative for Assessee [AR], Shri Vimal Punmiya, drawing our attention to the documents placed in the paper-book submitted that the assessee was engaged in trading activities and adequate stock details ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sactions to factorize for profit earned by assessee against possible purchase of material in the grey market and undue benefit of VAT against such bogus purchases, which lower authorities have rightly done. However, it is noticed that the assessee is dealing in a low margin item like metals which is subjected to lower VAT Rate. Another factor to be noted is that the assessee has reflected a Gross Profit Rate of 3.84% in the impugned AY. Therefore, keeping in view the totality of facts and circumstances, we reduce the estimated additions to 2% of alleged bogus purchases of Rs. 5,76,31,450/- which comes to Rs. 11,52,629/-. The balance addition stands deleted. The impugned order stand modified to that extent. 6. The appeal stands partly allow ..... X X X X Extracts X X X X X X X X Extracts X X X X
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