Taxing Profit Element in Grey Market Purchases Deemed Fair by CIT(Appeals); VAT Savings Considered.

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Full Text of the Document

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....Bogus purchases - estimation of profit - It could be safely concluded that assessee could have made purchases only from grey market in order to have savings from VAT and incidental profit element thereon. It would be just and fair to bring to tax only the profit element embedded in the value of such disputed purchases in as much as the ld. CIT(A) accepted the fact that the goods made by the assessee from the aforesaid suppliers had been actually consumed by it in the projects. - AT....