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TMI Blog2017 (2) TMI 1084X X X X Extracts X X X X X X X X Extracts X X X X ..... on the disclosed purchases and sales at 7.87%. But assessee made purchases of these items from Grey market and for that he has saved sale tax, octori tax and other benefits. We are of the view that a reasonable estimate should be made and according to us 10% of profit will made the end of justice. Accordingly, we are directed the AO to apply profit rate of 10% and accordingly assess the income. We directed the AO accordingly and appeal of Revenue is partly allowed. - ITA No. 5326/Mum/2016, CO No. 215/Mum/2016 - - - Dated:- 17-1-2017 - Sri Mahavir Singh, JM And Sri Rajesh Kumar, AM Revenue by : Shri Suman Kumar, DR Assessee by : Shri N.R. Agrawal, AR ORDER Per Mahavir Singh, JM This appeal is filed by the Revenue and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hence profit and Loss is not at all affected by above purchases. 4. Briefly stated facts are that the investigation wing of Income Tax received information from sales tax department of Maharashtra state that the assessee has taken bogus bills of electrical lights, lamps and fitting accessories for an amount of ₹ 37,93,785/- from the following parties: - TIN Name of the Party Amount 27200506372V Crystal Commercial Co. 2,43,000/- 27420502953V Bharat Industrial Corporation 5,03,438/- 27870653492V GM Impex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #39;ble Bombay High Court that merely because the suppliers have not appeared before the Assessing Officer or the CIT(A), one cannot conclude that the purchases were not made by the respondent-assessee. Further it has been held in the case of Saraswathi Oil Traders vs. CIT 254 ITR 259 (Supreme Court) that when the sales have not been doubted then there was no question to doubt the purchases and the addition should have been made only to the extent of gross profit. To this extent I am in agreement with the appellant that if the appellant has fulfilled his onus of submitting the details of purchases, stock statements and has supplied the address of the sellers, then it cannot be presumed that the sellers were bogus simply because the sellers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tails of purchase and sales i.e. bills and vouchers but could not submit stocks statements. Even parties are not verifiable being Hawala dealers. In such circumstances, only profit rate is to be estimated, which CIT(A) has rightly estimated. However, the rate of profit is a little on lower side reasons being the assessee himself declare profit on the disclosed purchases and sales at 7.87%. But assessee made purchases of these items from Grey market and for that he has saved sale tax, octori tax and other benefits. In that eventuality, we are of the view that a reasonable estimate should be made and according to us 10% of profit will made the end of justice. Accordingly, we are directed the AO to apply profit rate of 10% and accordingly asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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