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TMI Blog2025 (1) TMI 1493X X X X Extracts X X X X X X X X Extracts X X X X ..... ation, the assessee had earned gross profit of 1.6 percent.
AR also submitted that in most of the earlier years, the assessments were completed u/s 143(3) of the Act in the case of the assessee and no adverse inference was drawn thereon.
But the case involved herein is a case of unverifiable purchases where the profit margin would be slightly higher as purchases had been made in the grey market. Accordingly, we deem it fit and appropriate to estimate the profit margin embedded in the value of such disputed purchases at 2.5%, which in our considered opinion, would meet the ends of justice. Appeal of the assessee is partly allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... to be decided in the instant appeal is as to whether the learned CIT(A) was justified in confirming the addition made on account of unverifiable purchases in the facts and circumstances of the instant case. 4. We have heard the rival submissions and perused the materials available on record. The return of income for the assessment year 2014-15 was filed by the assessee on 21-11-2014 declaring total income of Rs 2,13,55,410/-. The assessee is engaged in the business of 100% export of readymade garments under the name and style of M/s DSM INTERNATIONAL, later known as M/s RBD INTERNATIONAL. The assessee is the proprietor of the said business engaged in the business of export of readymade garments, hosiery garments, handicraft furnishing item ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he same in the assessment. This action of the Learned AO was upheld by the Learned CIT(A). 6. The Learned DR vehemently submitted that the 22 suppliers had not responded to the notice issued under section 133(6) of the Act. He submitted that assessee could not furnish evidences with contemporaneous documents to prove the veracity of the purchases made from the 22 suppliers. He drew our attention to various observations made by the Learned AO in the assessment order. Hence he submitted that the lower authorities were duly justified in disallowing the value of purchases made from these 22 suppliers on the ground that they are unverifiable. 7. We find that assessee had given the details of purchases made from the 22 suppliers and also furnis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fine our discussions only to the issue of disallowance of unverified purchases in this appeal. 8. As stated earlier, the corresponding sales made by the assessee out of disputed purchases were not doubted by the revenue. Similarly, the stock registers were duly furnished by the assessee before the lower authorities and the same were not doubted. The entire books of accounts have been placed before the Learned AO and the book results were accepted by the Learned AO and the same were not rejected by him. At the same time, the assessee also from its side could not prove the purchases made from 22 parties beyond reasonable doubt. Hence, it becomes a case of unverifiable purchases. We find that the corresponding sales had not been doubted by th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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