TMI Blog2020 (2) TMI 1664X X X X Extracts X X X X X X X X Extracts X X X X ..... stical purposes only. - ITA NO.7199/MUM/2018, ITA No.7183/Mum/2018 & ITA No.7184/Mum/2018 - - - Dated:- 26-2-2020 - SHRI R.C. SHARMA, ACCOUNTANT MEMBER SHRI PAWAN SINGH, JUDICIAL MEMBER Assessee by : Shri Himanshu Gandhi Revenue by : Shri Satishchandra Rajore O R D E R PER R.C. SHARMA, ACCOUNTANT MEMBER These are the appeals filed by the assessee against the order of CIT(A)-30/19(2)/13292/2016-17 CIT(A)-30/19(2)/13289/2016-17, CIT(A)-30/19(2)/13280/2016-17 CIT(A)-30/19(2)/14906/2016-17 dated 10/10/2018 for A.Y.2012-13, 2013-14 2014-15, in the matter of order passed u/s.143(3) r.w.s. 147 of the Income Tax Act, 1961. 2. Common grievance of assessee in all the years are same with regard to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions have been heard and record perused. Facts in brief are that the assessee is engaged in business of manufacturing, import, export and trading of cut and polished and rough diamonds. The A.O. got information from the Investigation Wing of the Department regarding assessee having obtaining accommodation bill with regard to purchases of diamonds. Accordingly, the case was reopened for the A.Y. 2011-12 and thereafter the addition was made by the A.O. by estimating profit @ 3% on polished diamonds and 5% on rough diamonds. By the impugned order, the ld. CIT(A) confirmed the addition by estimating profit at 3% in polished and rough diamonds both, against which the assessee is in further appeal before the ITAT. 4. The ld AR of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the A.O. an contended that during the course of search at Bhanwar Lal group, it was found that the assessee has taken accommodation bills of purchases without taking delivery. 7. We have considered the rival contentions and carefully gone through the orders of the authorities below and found from the record that the assessee is engaged in manufacturing, export and trading of diamonds. We also found that before the A.O., the assessee has filed quantitative details of purchases, stock register reflecting goods received and processing and manufacturing thereof and corresponding sales with individual invoice with respect to alleged bogus purchases. The A.O. made addition by estimating GP on such alleged bogus purchases. By the impugned o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Industries Ltd.. (supra) cannot be applied without reference to the facts. In fact in paragraph 8 of the same Judgment the Court held and observed as under- So far as the question regarding addition of Rs.3,70,78,125/- as gross profit on sales of Rs.37.08 Crores made by the Assessing Officer despite the fact that the said sales had admittedly been recorded in the regular books during Financial Year 1997-98 is concerned, we are of the view that the assessee cannot be punished since sale price is accepted by the revenue. Therefore, even if 6% gross profit is taken into account, the corresponding cost price is required to be deducted and tax cannot be levied on the same price. We have to reduce the selling price accordingly as a result of wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods received, the addition is required to be made only to the extent of difference between the GP declared by the assessee on normal purchases vis a vis bogus purchases. Respectfully following the order of the Hon'ble Jurisdictional High Court and the Coordinate Bench of the ITAT, Mumbai, we restore the matter back to the file of the A.O. to restrict the addition to the extent of lower GP declared by the assessee in respect of bogus purchases as compared to GP on normal purchases. The assessee is also directed to give full details to the A.O. with regard to GP earned on normal purchases and also GP earned on alleged bogus purchases. We direct accordingly. 10. In the result, both the appeals of the assessee are allowed in part for s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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