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TMI Blog2019 (12) TMI 1617X X X X Extracts X X X X X X X X Extracts X X X X ..... e is also directed to give full details to the A.O. with regard to GP earned on normal purchases and also GP earned on alleged bogus purchases. Appeals of the assessee are allowed in part for statistical purposes only. - ITA Nos. 7198 & 7200/Mum/2018 - - - Dated:- 16-12-2019 - Shri R.C. Sharma, AM And Shri C.N. Prasad, JM For the Assessee : Shri Himanshu Gandhi (AR). For the Revenue : Shri K.C. Selvamani (DR). ORDER PER: R.C. SHARMA, A.M. These are the appeals filed by the assessee against the separate orders of the ld. CIT(A)-30, Mumbai dated 12/10/2018 for the A.Y. 2011- 12 an 2013-14 respectively in the matter of order passed U/s 143(3) r.w.s. 147 of the Income Tax Act, 1961 (in short, the Act). 2. Griev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the reopening, he further contended that in the A.Y. 2011-12, the A.O. has not recorded any reason to believe that there is escapement of any income, accordingly, the reopening was not justified. 5. With regard to merit of the addition, the ld AR has relied on the decision of Hon ble Jurisdictional High Court in the case of Pr.CIT Vs. Mohommad Haji Adam Co. in ITA No. 1004 of 2016 order dated 11/02/2019. He has further submitted that the Hon ble Jurisdictional High Court decision has been consistently followed by the various Benches of the Tribunal. Respective orders were placed on record. It was contended that when corresponding sale are accepted, the addition on account of bogus purchases should be confined to the difference between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a finding of fact, we have proceeded on such basis. Despite this, the question arises whether the Revenue is correct in contending that the entire purchase amount should be added by way of assesses additional income or the assessee is correct in 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 as ses see' s sale s . There was no di s c repanc y 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts were confronted to the learned Sr. DR, he requested for application of reasonable profit rate and according to him the profit rate applied by the AO and confirmed by CIT(A) is quite reasonable in view of the decision of Hon ble Gujarat High court in the case of Smith P.Seth (supra). We have considered the rival contentions and are of the view that Hon'ble Bombay High Court in the case of Mohammad Haji Adam Co. and Ors. (supra) has considered this issue and respectfully following the same, we direct the AO to restrict the profit rate only to the extent of differential percentage as declared on the bogus purchases and as declared on the regular purchases, Hence, we direct the AO accordingly. 9. It is clear from the above dec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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