2020 (4) TMI 561

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.... as well as C.O. filed by the assessee are identical, therefore for the sake of convenience; they are clubbed, heard and disposed of by this consolidated order. First, we are taking ITA No. 6873/Mum/2018 for AY 2009-10 filed by the revenue. 3. The brief facts of the case are that assessee is engaged in the business of trading in Iron & Steel. The return of income for the aforesaid assessment year was filed on 21.09.2009 declaring total income of Rs. 7,28,704/-. Subsequently, the return was processed u/s. 143(1) of the Income Tax Act, 1961 ('the Act). On receipt of the information from the DGIT(Inv.), Mumbai, it came to light that assessee is indulged in hawala transactions. Thereafter, the case of assessee was reopened u/s 147 of the ....

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....ow partial relief to the assessee. We order accordingly. 5. By relying upon the above decision, Ld. CIT(A) came to the conclusion that assessee has already declared 2.97% as GP for this assessment year and after considering the submissions of assessee, he confirmed the disallowance @ 3.75% on accommodation entries. 6. Aggrieved with the above order, revenue has preferred the appeal before us on the ground mentioned herein below:- 1. "Whether on the facts and circumstances of the case and in law, the Ld. C.I.T. (A) was justified in restricting the addition made by the AO to 3.75% of Rs. 86,52,2637- against the addition made at 12.5% of the bogus purchases, ignoring that the notices u/s 133(6) issued by the Assessing Officer to the allege....

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.... 3rd Sept 2018. He relied on the facts which was submitted before Ld. CIT(A) and further relied on the decision of Coordinate Bench of ITAT in the case of Vaishali Prakash Muni Vrs. ITO (ITA No. 378-380/Mum/18). He submitted that in the above said decision, the Coordinate Bench of ITAT has clearly brought on record that the steel industry normally earns GP rate of 4% and they rejected the findings of AO for disallowance of 12.5% of the purchases and finally they were directed the AO to disallow only to the extent of 2% of the alleged bogus purchases. He prayed that in the given case also, the disallowance should be restricted to such percentage. 9. Considered the rival submissions and material placed on record as well as the orders passed ....