Tribunal affirms profit estimates for Garden Trading & Maintenance Contracts. Revenue appeal dismissed.

The Tribunal upheld the Ld.CIT(A)'s decision to estimate the profit element at 8% and 12.5% for the Garden Item Trading and Garden Maintenance Contract segments, respectively, for the Assessment Years 2009-10 and 2012-13. The Revenue's appeal and the assessee's cross objections were dismissed, confirming the Ld.CIT(A)'s order regarding the disputed purchases treated as non-genuine. The decision was pronounced on April 17, 2018.

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Issues:
- Dispute over purchases treated as non-genuine by the Assessing Officer
- Estimation of profit element from purchases in Garden Item Trading and Garden Maintenance Contract segments
- Appeal against the order of Ld.CIT(A) in estimating profit element
- Revenue's appeal in not sustaining entire purchases disallowed by the Assessing Officer

Analysis:
1. The appeals were filed by the Revenue and cross objections by the assessee regarding the orders of the Ld. Commissioner of Income Tax (Appeals) for the Assessment Years 2009-10 and 2012-13. The main issue was the treatment of certain purchases as non-genuine by the Assessing Officer, with the Ld.CIT(A) estimating the profit element from these purchases at 8% in Garden Item Trading segment and 12.5% in Garden Maintenance Contract segment. The assessee appealed against the Ld.CIT(A)'s order, while the Revenue appealed against not sustaining the entire disallowed purchases.

2. The Assessing Officer found the assessee to be a beneficiary of bogus purchase bills from suspicious dealers listed by the Maharashtra Sales Tax Department. Despite the assessee providing various proofs of the genuineness of the purchases, the Assessing Officer rejected the submissions and treated all purchases from the mentioned parties as non-genuine.

3. The Ld.CIT(A) considered the submissions, evidence, and relevant case laws, including the decision of the Hon'ble Gujarat High Court, and held that only the fair profit ratio should be added back to the income of the assessee when total sales are accepted. The Ld.CIT(A) adopted a similar approach taken in previous cases related to the assessee's group and estimated the profit element at 8% for trading sales segments and 12.5% for Garden Maintenance contract segments.

4. The Tribunal, following the precedent set in a previous case for the Assessment Year 2011-12, upheld the Ld.CIT(A)'s decision to estimate the profit element at 8% and 12.5% for the Garden Item Trading and Garden Maintenance Contract segments, respectively. The Tribunal rejected the Revenue's appeal and dismissed the cross objections of the assessee, confirming the Ld.CIT(A)'s order.

5. In conclusion, the Tribunal sustained the Ld.CIT(A)'s order for the Assessment Years 2009-10 and 2012-13, confirming the estimation of the profit element from the disputed purchases. Both the appeals of the Revenue and cross objections of the assessee were dismissed, and the order was pronounced on April 17, 2018.

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