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TMI Blog2022 (3) TMI 652X X X X Extracts X X X X X X X X Extracts X X X X ..... ofit should be determined at 10%. Therefore, by following the finding of Co-ordinate Bench in the case of Dilawar R. Shaikh [ 2017 (8) TMI 1658 - ITAT PUNE] we direct the AO to determine gross profit at 10% on such alleged purchases. Thus, the ground Nos. 1 to 3 raised by the assessee are allowed. Disallowance made u/s. 14A - HELD THAT:- We deem it proper to remand the issue to the file of AO for computing the disallowance of expenditure relating to the investments yielded exempt income. The assessee is liberty to file evidences, if any, in support of his claim. Thus, ground Nos. 4 and 5 raised by the assessee are allowed for statistical purpose. - ITA Nos. 1454 & 2358/PUN/2017 - - - Dated:- 4-3-2022 - SHRI S.S. VISWANETHRA RAVI , ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d entire purchases as hawala purchases. The ld. AR placed on record the decision of Co-ordinate Bench of the Tribunal and by referring to Para Nos. 5 to 7 in the case of Dilawar R. Shaikh Vs. DCIT in ITA Nos. 1832 to 1834/PUN/2017 and argued that the AO could not have added entire purchases to the total income and must have taken only gross profit. The ld. DR relied on the orders of authorities below. Admittedly, there is no dispute that the AO added entire purchases to the total income of the assessee holding that the assessee failed to produce any of the evidences to prove that there was physical movement of goods which was confirmed by the CIT(A). We note that in the case of Dilawar R. Shaikh (supra) on similar circumstances the Co-ordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by applying the methodology provided under Rule 8D of the Rules. Accordingly, the AO disallowed expenditure to an extent of ₹ 23,51,799/- (₹ 10,13,469/- + ₹ 54,297/-). It shows there is incorrect calculation made by the AO showing total disallowance as ₹ 23,51,799/- instead of ₹ 10,67,766/-. The CIT(A) also confirmed the addition made by the AO without acknowledging the incorrect calculation. Therefore, the disallowance made by the AO is only ₹ 10,67,766/- but not ₹ 23,51,799/-. 8. We note that the CIT(A) reproduced the details of investments as on 31-03-2010 furnished by the assessee in the impugned order at Page No. 16. The ld. AR contended that the said investments as reproduced by the CIT(A) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act in Page No. 126 of the paper book. Thus, we deem it proper to remand the issue to the file of AO for computing the disallowance of expenditure relating to the investments yielded exempt income. The assessee is liberty to file evidences, if any, in support of his claim. Thus, ground Nos. 4 and 5 raised by the assessee are allowed for statistical purpose. ITA No. 2358/PUN/2017 10. We note that the assessee raised two grounds involving one issue questioning the action of CIT(A) in confirming the order of AO in making the addition on account of hawala purchases. Both sides are unanimous in stating that the issue raised in the appeal and the facts in ITA No. 2358/PUN/2017 are identical to ITA No. 1454/PUN/2017. Since, the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X
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