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TMI Blog2019 (2) TMI 1342X X X X Extracts X X X X X X X X Extracts X X X X ..... t these eleven parties from whom the assessee allegedly purchased material were accommodation entry providers who were merely issuing bogus bills without supplying/delivering any material. The genuineness of the purchases made from these eleven parties could not be proved by the assessee and the incriminating information received by Revenue from Maharashtra VAT department remained un-controverted. The authorities below have estimated embedded profits @12.5% of alleged bogus purchases made by the assessee from these accommodation entry providers who were issuing bogus bills without supplying material. Estimation of the profits have to be undertaken which requires some guess work to assess income underlying these bogus bills which are alleged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 8349395/- which is made on account of estimation of profit @ 12.50% on alleged bogus purchases of ₹ 66795161/- to the total income of the Appellant. (b) estimating rate of profit at 12.50% on alleged bogus purchases over and above gross profit declared of 4.10% by the appellant on such purchases. Reasons assigned by him are wrong and insufficient to justify estimating rate of profit @ 12.50% on alleged bogus purchases and making addition of ₹ 8349395/- over and above profit declared by appellant on such purchases. 2. On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeal) erred in confirming rejection of books of accounts of the appellant by invoking provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s metals. The information was received by learned Assessing Officer( hereinafter called "the AO") from the DGIT(Inv.), Mumbai wherein it was stated that the information was received from the Sales Tax Department, Govt. of Maharashtra that the assessee is appearing in the list of beneficiaries of bogus purchase/hawala transactions of obtaining bogus bills without taking delivery of goods from the following parties , as detailed hereunder:- ,Sr:No. Name of the Parties Amount Involved (In Rs.) 1 KIRAN SALES CORPORATION/ NIDHI IMPEX INDIA 20660024 2 SURAJ STEEL INDIA 506480 3 JINESH METAL CORPORATION 2365254 4 JACOB INDUSTRIES 5099874 5 ANIKET STEEL PVT. LTD. 6274186 6 VIGNESHWAR IMPEX 8966532 7 TYSON STEEL & TUBES 12096 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich as per the AO remained unverifiable , profit embedded on which as per the AO was not disclosed by the assessee in return of income filed with the revenue leading to additions to the income of the assessee by the AO , vide assessment order dated 27.03.2015 passed u/s 143(3) r.w.s. 147 of the 1961 Act. The AO while estimating aforesaid profits embedded in these alleged bogus purchases relied upon following case laws:- a) 12.5% disallowance out of bogus/unverifiable purchases: 1. Smt. Sajjandevi B Jain v. ITO in ITA No .609/Ahd/2009 (ITAT- Ahmedabad Bench) 2. Sh. Simit P Sheth v. ITO Wd-2(2), BRD in ITA No.3238 & 3293/Ahd/2009 (ITAT-Ahmedabad Bench) b) 25% disallowance out of bogus/unverifiable purchases: 1. Sanjay Oil Cake Industrie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also given a report that these parties do not exist at the given addresses. The learned CIT(A) also relied upon decision of the Hon'ble Supreme Court in the case of CIT v. Daulat Ram Rawatmull (1973) 87 ITR 349(SC) and CIT v. Durga Prasad More 82 ITR 540(SC), Sumati Dayal v. CIT 214 IT 801(SC). The learned CIT(A) also relied upon decision of Hon'ble Gujarat High Court in the case of CIT v.Simit Sheth 356 ITR 451(Guj), to confirm/affirm the additions as were made by the AO vide appellate order dated 17.02.2017 passed by learned CIT(A). 5. Aggrieved by the appellate order dated 17-02-107 passed by learned CIT(A), the assessee has come in appeal before the tribunal. The assessee has moved an application for adjournment through one Mr Mayank ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IA 20660024 2 SURAJ STEEL INDIA 506480 3 JINESH METAL CORPORATION 2365254 4 JACOB INDUSTRIES 5099874 5 ANIKET STEEL PVT. LTD. 6274186 6 VIGNESHWAR IMPEX 8966532 7 TYSON STEEL & TUBES 12096797 8 ANTRISH METALS 1630703 9 ANUPAM METAL 861519 10 NAYAN STEEL CENTRE 2213769 11 NATIONAL STEEL 5120023 TOTAL 66795161 The notices u/s 148 of the 1961 Act was issued within four years from the end of assessment year. Notices u/s. 133(6) were issued by the AO to these eleven parties but ten out of eleven notices return un-served by postal authorities with remarks 'left' . The AO deputed inspector to make enquiries who also reported that these parties do not exist at their given addresses. The assessee could not produce t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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