9911796707
TMI Blog2010 (8) TMI 32X X X X Extracts X X X X X X X X Extracts X X X X ..... s well as survey, search, seizure and requisition of books of accounts. - The difference in purchase rate has been arrived at by the learned CIT(A) is merely 1.5%. This in our opinion is not significant enough to warrant any addition based on surmises. The learned CIT(A) has himself observed that provision of section 40A(2) are not attracted in this case. It is also an admitted fact that assessee has made the profit on those purchase. It is also not the case that there is decline in the gross profit rate as compared the previous year. No case has also been made out that the profit earned on these purchase was not up the mark. Under the circumstances, in our opinion the addition on account of substitution of purchase price by the revenue is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of books of accounts. 4. The ITAT in its impugned order has also pointed out that the excess in purchase price of goods purchased from Mr. Sanjay Kumar Garg is only about 1.5% and further inability of assessee to produce the supplier could not lead to the inference that the supplier was bogus. The relevant observations in the impugned order are reproduced hereinbelow:- "6.2 We have carefully considered the rival submission and perused the records. Admittedly, in this case the addition is being made on the basis that purchase made by the assessee from the impugned parties during certain period is higher than the average purchases made from other suppliers. According to the working of the learned CIT(A) the excess comes 139 per/MT on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admitted fact that assessee has made the profit on those purchase. It is also not the case that there is decline in the gross profit rate as compared the previous year. No case has also been made out that the profit earned on these purchase was not up the mark. Under the circumstances, in our opinion the addition on account of substitution of purchase price by the revenue is not justified. 6.4 In this regard, we draw support from the decision of the Hon'ble Apex Court in the case of CIT, Bombay Vs. Walchand and Co. Private Ltd. In 65 ITR 381, wherein it was held that "in applying the test of commercial expediency for determining whether an expenditure was wholly and exclusively for business, the expenditure has to be adjudged from the po ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
