2016 (7) TMI 1507

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..... rate disclosed by the assessee in the assessment year 2009-2010 was 4.73%, wherein assessment year 2010-11 was 3.72. There is increase of 33% in the sales amount during the year under consideration. The sales has increased from 16.62 crores to 21.83 crores during the year. Increase in sales reduces the net profit margins slightly , therefore, keeping in view the GP rate of 3.72% in earlier year as .....

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..... /- on account of bogus purchases. 4. By the impugned order the CIT(A) upheld the addition of inflated purchases to the extent of 25% by observing that the AO has accepted the trading results as disclosed in the audited profit and loss account, wherein total sales of ₹ 21.83crores have been accepted. Once the sales are accepted, as per CIT(A), purchases cannot be doubted. However, against .....

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..... crores during the year. Increase in sales reduces the net profit margins slightly , therefore, keeping in view the GP rate of 3.72% in earlier year as well as increase in turn over during the year under consideration, we direct the AO to restrict the addition by applying the GP rate of 3.50% in place of 3.44% shown by the assessee. We direct accordingly. 7. In the result, appeal of the assesse .....

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