2021 (3) TMI 161

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....inst the order dated 24-05-2019 of learned Commissioner of Income Tax (Appeals)-7, Mumbai for the assessment year 2010-11. 2. The dispute in the present appeal is confined to disallowance made on account of non genuine purchases. Pertinently, though, the assessee has raised ground 2 challenging the ex parte disposal of appeal; however, at the time of hearing, learned Authorised Representative d....

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....7 of the Act. In course of assessment proceedings, the Assessing Officer called upon the assessee to prove the genuineness of purchases made through proper evidence. Though, the assessee produced some evidences to prove the purchases; however, they were not to the satisfaction of the Assessing Officer. Therefore, he treated the purchases as non genuine. After rejecting the books of account of the ....

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....oods. He submitted, merely because some documentary evidences could not be furnished, the purchases cannot be held as non genuine. Further, he submitted, the normal profit rate in this line of business varies between 2% to 5%. Therefore, disallowance at 12.5% is high and excessive. Finally, he submitted, in case of one of the partners of the firm in similar line of business, the Tribunal in ITA No....

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.... have not been doubted. This pre-supposes that in absence of the purchases, the assessee could not have effected corresponding sales. Even, the Assessing Officer was also convinced with this fact. Hence, instead of disallowing the entire purchases, he disallowed only the profit element by estimating at 12.5%. Therefore, the issue before me is, whether the disallowance made at 12.5% is reasonable? ....