TMI Blog2021 (3) TMI 632X X X X Extracts X X X X X X X X Extracts X X X X ..... her than gross profit rate on account of fact that deficiency is reasonably proved by the Assessing Officer) of transactions covered by accommodation entries. For AY 2011-12, the Ld. CIT(A) has followed the rate applied for AY 2009-10 i.e. 6.75% of value of accommodation entries found to be bogus on the ground that the facts for AY 2011-12 are similar to AY 2009-10. - ITA No. 5091/MUM/2019 ITA No. 5092/MUM/2019 ITA No. 5095/MUM/2019 - - - Dated:- 16-3-2021 - SHRI SAKTIJIT DEY ( JUDICIAL MEMBER ) AND SHRI N. K. PRADHAN ( ACCOUNTANT MEMBER ) Revenue by : Mr. Sanjay J. Sethi, DR Assessee by : None ORDER PER N.K. PRADHAN, A.M. The captioned appeals filed by the Revenue are directed against the order of the Commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... king purchases from them? 3. Briefly stated, the facts of the case are that the assessee filed his return of income for the assessment year (AY) 2009-10 on 26.09.2009 declaring total income of ₹ 2,26,170/-. The nature of business of the assessee is trading in MS Round Bar, MS Patta, MS Sheets. On receipt of information from the Sales Tax Department, Government of Maharashtra that the assessee had obtained bogus purchase bills amounting to ₹ 58,24,569/- from 11 parties, the Assessing Officer (AO) issued notice u/s 148 dated 19.03.2014 for reopening the assessment. During the course of re-assessment proceedings, the assessee filed before the AO, copies of (a) ledger accounts of the purchase party ; (b) purchase bill ; and (c) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DCIT (SLP 759 to 2017) dated 16.01.2017]. In the cited case of M/s Fagioli India Pvt. Ltd. gross profit was 37% and Hon. ITAT decided that estimate of profit be 12.5% on the figure of accommodation entry or bogus purchase. Further in Shri Mehul K. Mehta Prop. Vaishnavi Enterprises vs. Income Tax Officer 15(1)(3) Mumbai in I.T.A. No. 3227/Mum/2016 dated 14.03.2017 in the context of the case the Hon. ITAT ordered as under: We do not find any infirmity in the well reasoned appellate order of learned CIT(A) which we are inclined to affirm/sustain except that, in our considered view, the end of justice will be met in the instant case if GP is estimated to tune of 12.5% of the purchases from these alleged hawala operators which will cover a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by accommodation entries. This is in consonance with alternate ground (ground 3.4) of the appellant before me. 5. Before us, the Ld. DR submits that the estimation made by the AO @ 7.28% on the disputed purchases of ₹ 58,24,569/- which comes to ₹ 4,24,029/- be restored. We have heard the Ld. DR and perused the relevant materials on record. We find merit in the order of the Ld. CIT(A), wherein he has considered the nature of business of the assessee and the nature of investigation done by the AO and thereafter, held that disallowance be kept at 6.75% (being gross profit rate) of transactions covered by accommodation entries. The Ld. CIT(A) has taken note of the fact that the AO has not issued notice u/s 133(6) to th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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