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TMI Blog2019 (11) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... relied upon the decision of Hon ble Gujarat High Court in Simith P. Seth [ 2013 (10) TMI 1028 - GUJARAT HIGH COURT] . CIT(A) after considering the material placed before him and the ratio of the decisions including the decision of Simith P. Seth (supra) concluded that it has been held by various Courts that where assessee could show that he has made purchases and there are corresponding sales against the purchases, in such circumstances, it is appropriate to tax the possible profit of such purchase from non-genuine parties. CIT(A) restricted the disallowance to 12.5% of the purchases. CIT(A) after considering the material and the various decision of superior courts arrived on a fair conclusion, which we affirm. Even otherwise the reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 09-10 on 30.09.2009 declaring total income of ₹ 16,32,700/-. The return of income was processed under section 143(1). The assessment was re-opened under section 147 on the basis of information received from Sale Tax Department, Government of Maharashtra that certain hawala operators are indulging in providing accommodation bills without actual delivery of goods. The Sale Tax Department, Government of Maharashtra referred the list of such hawala dealers and the beneficiary to the DGIT (Investigation), Mumbai. The name of assessee appeared in the list of beneficiary. The assessee allegedly made the purchases of ₹ 2,76,275/- from M/s Sachi Mercantile Pvt. Ltd., whose name were included in the list such hawala dealer. On the basis o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 143(3) r.w.s 147. 4. On appeal before the ld. CIT(A), the ld. CIT(A) restricted the addition to the extent of 12.5%. The ld. CIT(A) while restricting the disallowances relied upon the decision of Hon ble Gujarat High Court in case of Simith P. Seth (356 ITR 451). The ld. CIT(A) also concluded that assessee might have made the purchases from grey market, operating in the grey market leads to various savings on account of non-payments of various taxes by use of unaccounted money and on such purchases, when sales are not disputed, the reasonable disallowances should be considered to avoid the revenue leakage. Thus, aggrieved by the order of ld. CIT(A), the revenue has filed the present appeal before us. 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and quantitative details and corresponding sales were shown to the Assessing Officer. Though, the assessee fairly stated that they are unable to produce the supplier for verification. It was also urged that the assessee has paid sale tax on behalf of the dealers and relied upon the decision of Hon ble Gujarat High Court in Simith P. Seth (supra). The ld. CIT(A) after considering the material placed before him and the ratio of the decisions including the decision of Simith P. Seth (supra) concluded that it has been held by various Courts that where assessee could show that he has made purchases and there are corresponding sales against the purchases, in such circumstances, it is appropriate to tax the possible profit of such purchase from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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