TaxTMI 
TaxTMI 
TaxTMI 
2018 (7) TMI 1859
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....es of the case and in law, the Ld.CIT(A) is justified in holding that only profit margin is embedded in respect of purchases of Rs. 50,43,126/- and thereby estimating such profit @15% and restricting the addition to the extent of Rs. 7,56,469/- as against the total disallowance of purchases of Rs. 50,43,126/- without any jurisdiction. 2. Whether on the facts and in the circumstances of the case and in law, the Ld.CIT(A) is justified in directing the Assessing Officer to delete the additions of Rs. 7,05,512/- without appreciating the fact that the purchases from M/s. Siddhi Vinay Corporation and M/s. Shah Industries are not genuine and these parties have been detected as Hawala parties by the Sales Tax Department." 3. Briefly stated relev....
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.... Corporation. Assessee submitted copies of sales invoices, bank details, delivery challans, octroi receipts, payments details etc,. However, the AO denied the claim of the assessee treating the same as bogus purchases and eventually added the same to the total income of the assessee. Thus, the AO made addition of Rs. 57,48,368. 5. In the First Appellate proceedings, the CIT(A) deleted the addition of Rs. 7,05,512/- made by the AO and held that AO failed to examine the evidences produced by the assessee. It was also held that AO did not point out any defects in the books of account and did not doubt any sales made to Municipal Corporations and prominent parties. The CIT(A) eventually concluded that the AO made the disallowance based on pres....
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....itted that the tax effect in the present appeal is less than Rs. 20 Lakhs. 9. Both sides heard. A perusal of the impugned order shows that the addition made in the assessment year under consideration is on account of purchases made by the assessee alleged to have been made from bogus/hawala parties. The total tax on disputed addition of Rs. 55,48,638/- in the present appeal is undisputedly is less than Rs. 20 Lakhs. The CBDT circular No.3/2018 dated 11th July, 2018 raised the monetary limit of tax effect for filing of appeal by the Department before the Tribunal to Rs. 20 Lakhs. The circular applies to the pending appeals of the Department before the Tribunal too. Thus, in view of the CBDT circular, we are of the opinion that the present a....
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.... available in the case of the appellant, I feel that the ratio of the decision of Hon'ble Gujarat High Court applies to the present case as well. In the case of the appellant as well, it has been able to file evidences reflecting that purchases were there although from some other parties and not from the parties from whom just bills were obtained. There are corresponding sales also. Accordingly, following the ratio of this decision, it cannot be said that entire purchases of Rs. 50,43,126/- is disallowable. I accordingly hold that the appellant is taxable on the amount of gross profit which has arisen out of such purchases for which bills have been procured from local parties. The average rate of G.P. shown by the appellant during the prece....