2020 (8) TMI 302

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....x Act, 1961 (hereinafter 'the Act'). 2. The only issue in this appeal of Revenue is against the order of CIT(A) restricting the addition made by the Assessing Officer by applying the profit rate at 12.5% of the bogus purchase. For this Revenue has raised following ground: - "1. Whether on the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in directing the A.O. to restrict the addition of bogus purchases to 12.5% as against 100% addition made by the A.O., relying on the decision of Hon'ble Gujarat High Court in the case of CIT vs. Simit P. Seth, 356 ITR 451? 3. Briefly stated facts are that the assessee engaged in the business of development of real estate properties. The AO received inform....

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....of the bogus purchases by observing in para 8.1 by following the decision of Hon'ble Gujarat High court in the case of CIT vs. Smith P. Seth (2013) 356 ITR 451 (Guj) by observing as under: - "8.1 Ground No. 1 of the appeal are against addition of Rs, 10,14,743/- as bogus purchases. As per the investigations carried out by the Sales Tax Authorities, the aforementioned party was found to be involved in giving accommodation entries only without actually supplying the goods. The logical inference is that the purchases made by the appellant would also be in the nature of accommodation entries only. To verify the same, the AO had made enquiries by issuing notices u/s 133(6) which were returned unserved by the postal authorities. This par....