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TMI Blog2019 (5) TMI 1732X X X X Extracts X X X X X X X X Extracts X X X X ..... ed:- 7-5-2019 - Sri Mahavir Singh, JM And Sri NK Pradhan, AM Appellant by: Shri Neelkanth Khandelwal, AR Respondent by: Shri Chaitanya Anjaria, DR ORDER Mahavir Singh, This appeal filed by the assessee is arising out of the order of Commissioner of Income Tax (Appeals)-53, Mumbai [in short CIT(A)], in appeal No. CIT(A)-53/IT-368/ITO-19(3)(1)/2017-18, dated 17.04.2018. The Assessment was framed by the Income Tax Officer, ward -19(3)(1), Mumbai (in short ITO/ AO ) for the A.Y. 2011-12 vide order dated 13-112016 under section 143(3) of the Income Tax Act, 1961 (hereinafter the Act ). 2. The first issue in this appeal of assessee is against the validity of reopening of assessment by the AO under section 147 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Amount HarshilFerrome Pvt. Ltd. 18,91,730/- MarutiImpex 25,51,212 Rehbar Enterprise 13,726 Subham Steel Impex 28,20,278/- total 72,76,946 6. During the course of assessment proceedings and during appellate proceedings, the assessee submitted documentary evidences such as payment received against such sales, receipt of material purchases, account payee cheque. According to the AO, the assessee failed to establish the genuineness of the purchase and accordingly, he made addition of unproved purchase at 12.5% of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his he filed statement of purchases made from bogus parties and consequent profit rate shown by the assessee on these bogus purchases and the details are as under: - Sale Excluding VAT 7137429.61 Purchase Excluding VAT/ CST 6965878.40 Gross Profit 171551.21 Gross Profit Rate 2.40 From the above, the learned Counsel for the assessee also referred to the total statement of purchase, sales and consequent profit in regular business, which is at 5.48% and the relevant details are as under: - Total purchase (Other than the purchase from the purchase pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n contending that such logic cannot be applied. The finding of the CIT(A) and the Tribunal would suggest that the department had not disputed the assessee's sales. There was no discrepancy between the purchases shown by the assessee and the sales declared. That being the position, the Tribunal was correct in coming to the conclusion that the purchases cannot be rejected without disturbing the sales in case of a trader. The Tribunal, therefore, correctly restricted the additions limited to the extent of bringing the G.P. rate on purchases at the same rate of other genuine purchases. The decision of the Gujarat High Court in the case of N.K. I (supra) cannot be applied without reference to the facts. In fact in paragraph 8 of the same Jud ..... X X X X Extracts X X X X X X X X Extracts X X X X
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