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TMI Blog2022 (6) TMI 1347X X X X Extracts X X X X X X X X Extracts X X X X ..... see cannot be accepted and right course in such case is to reject books of accounts and profit has to be estimated by applying a comparative profit rate in the same trade. Though there can be a little guess work in estimating profit rate but such profit rate cannot be punitive. Thus respectfully following the decision of the Tribunal in the case of Unique Metal Industries (supra), whereby the addition of 20% of the purchases sustained by the Ld. CIT(A) has been deleted in the identical facts and circumstances of the case, are not inclined to sustain the similar addition in the instant case. Appeal of the assessee is allowed. - ITA No. 196/Del/2021 - - - Dated:- 24-6-2022 - SHRI KUL BHARAT , JUDICIAL MEMBER For the Appellant : Ved Jain , Adv. For the Respondents : Om Prakash , Sr. DR ORDER Per Kul Bharat , JM This appeal filed by the assessee for the assessment year 2007-08 is directed against the order of Ld. CIT(A)-18, New Delhi dated 11.08.2020. 2. The assessee has raised following grounds of appeal:- 1. On the facts and circumstances of the case, the order passed by the learned Commissioner of Income Tax (Appeals) [CIT(A)] is bad, both in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nces of the case, the learned CIT(A) has erred, both on facts and in law in rejecting that the inference drawn by the AO merely on the basis of a statement that these firms are not in actual business is baseless and contrary to the facts on record. 7. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law in rejecting the contention of the assessee in ignoring the fact that the quantity purchased and sold being completely tallying, the allegation that the assessee has not made purchases cannot be sustained. 8. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law in confirming the addition on account of bogus purchases, despite their being adequate material and evidences brought on record by the assessee before the AO to show that the purchases and sales were made in the regular course of business. 9. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law in rejecting the contention of the assessee that the addition so made on the basis of material collected at the back of the assessee, is bad in law and liable to be deleted. 10. O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the reassessment proceedings initiated by the AO and has also deleted the impugned addition made by the AO on the merits of the case. The findings of the Hon'ble Tribunal in the case of A.Y. 2006-07 with regard to the reopening of the case are at Page 14 in Para 10 (enclosed at PB 114) and with regard to the merits of the case are at Page 15-16 in Para 12 (enclosed at PB 115-116). 3. It is submitted that similar cases have also been heard before this Hon'ble Tribunal involving verbatim reasons, similar arguments and similar findings. These cases are also being relied upon, which are as under: Unique Metal Industries v. ITO in ITA No. 1372/Del/2015 dated 28.10.2015 M/s. Radhay Shy am and Co. vs. ITO in ITA No. 1429/Del/2015 dated 30.11.2015 before SMC-1 Bench. M/s. Kishan Lal Gambhir Sons v. ITO in ITA No. 1516/Del/2015 dated 02.12.2015 before 'F' Bench. M/s. Kakkar Bartan Store v. ITO in ITA No. 1380/Del/2015 dated 23.03.2016 M/s. Krishan Lai Sons v. ITO in ITA No. 1379/Del/2015 dated 23.03.2016 M/s. Laxmi Dhatu Bhandar v. ITO in ITA No. 1369/Del/2015 dated 23.03.2016 M/s. Karshni Metal Store v. ITO in ITA N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal including that of the Unique Metal Industries (supra), we observe that the AO had recorded similarly worded reasons and name of the parties form whom the assessee alleged to have made bogus purchases were also same except the amount mentioned therein in the reasons recorded in the tabular form, as in the case of the present assessee. We, therefore, respectfully following the above decisions of the Tribunal in the case of Unique Metal Industries (supra), hold that the initiation of reassessment proceedings as well as issuance of notice u/s. 148 of the Act was not valid and the same was void ab initio and thus, liable to be quashed along with assessment order passed in pursuance thereto. Accordingly, Ground Nos. 2 and 3 of the assessee are allowed. 11. Now coming to the merit about the sustenance of the addition by the CIT(A) @ 20% of the purchases made by the assessee from M/s. Vishu Trading Company, M/s. Om Agencies., after hearing the rival submissions and going through the order of the Tribunal, we note that this Tribunal vide its order dated 28.10.2015 in the case of Unique Metal Industries (supra), deleted similar addition by observing in para 27 as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X
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