TaxTMI 
TaxTMI 
2022 (5) TMI 778
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....ngs on reconciliation of the data provided by the Customs Authority with the assessee's submission and found to be the purchases made out of the books? 2. Whether on the facts and circumstances of the case and in law, the ld. CIT(A) justified in deleting the addition of Rs.2,78,98,766/- made by the AO by arriving at the peak amount of Rs.11,95,963/-in respect of the import purchases, ignoring the fact that for estimating peak details such as source of amount in Indian currency, its conversion in foreign currency, details of sales, details of receipt of payment of sales were required and the Ld. CIT(A) should have verified by way of remand report from AO on the said transactions? 3. Whether on the facts and circumstances of the case and in law, the ld. CIT(A) justified in deleting the addition of Rs.2,78,98,766/- made by the AO, ignoring the fact that the assessee's in his own submission dated 21.12.2017 admitted that he was not in a position to reconcile the discrepancy pointed out and offered the alleged purchase amounting to Rs.2,78,98,766/ together with custom duty paid thereon of Rs.39,74,452/-as undisclosed turnover and without any remand report from ....
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....t of gross profit. The addition under section 69 of the Act was deleted holding that once the correspondent sales have not been disputed the unaccounted purchase cannot be added. Further, he considered the peak amount of Rs. 11,95,963/- which was confirmed as addition u/s 69C of the act. His findings are as under:- "4. I have carefully considered the submissions and arguments of A.R of the appellant. have carefully gone through assessment order and basis of rejection of appellant's argument by the A.O. in the assessment order. 4.1. Ground No. 1 to 4 These Grounds of the appeal relates to addition made by the A.O not considering that assessee was not entitled to invoke section 69C once the GP ratio for computing income on account of out of books purchases were made and hence such addition amounting to Rs.3,18,73,218/- is not justified. 4.1.2 From the undisputed fact it is clear that the appellant has paid excess custom duty of Rs.39.74,452 and has neither disclosed corresponding purchases and corresponding sales. The A.O. has not questioned sales out of such unrecorded purchases. Thus it is a case of unrecorded purchase and sale transactions. In such a....
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....addition of entire excise duty component by way of assessee's additional undisclosed income (para 13) Two things are fairly well settled. Firstly even in case of clandestine sales or purchases of goods, the courts approve not entire amount necessarily but the profit element embedded therein unless of course, it can be shown that the sales of purchases were totally bogus and therefore, would have the propensity to suppress the assessee's disclosed income. Second in such clandestine sales, the profit element is likely to be somewhat higher thatn the disclosed sales. Essentially, it would be question of estimation permitting certain degree of leeway to the A.O. and consequently to the tribunal. When the assessee evades payment of excise duty, undoubtedly, the same would be an additional element of profit on the product as compared to the one which has suffered the excise duty. This excise duty component which should have gone to the state exchequer would be an additional margin which may be shared by the purchaser and seller. In a given case, therefore, the assessee's contention that entire addition of excise duty element was not justified, may require closer exam....
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....upees, assessable value for customs and duty paid hereon. On the verification of the detail it is found that there is difference between the invoice value in rupees and assessable value for customs. Assessable value for custom is on higher side in each of the invoices than the invoice value. The learned Assessing Officer as well as the learned CIT (A) both has overlooked the fact that there can be difference between the invoice value and the assessable value of goods imported as per the Customs Act. Therefore, unless that is reconciled it cannot be said that assessee has purchased goods out of books of account. Further, the mere difference between the invoice value and the assessable value cannot result into an addition. Further, when there is an import of goods the payment is required to be made from one of the bank accounts of the assessee. Therefore, assessee cannot say that he is not in a position to reconcile the difference. The learned Assessing Officer has also taken this explanation in a casual manner without looking to the bank account from which the import price is paid and custom duty is also deposited. The learned CIT (A) has deleted the addition stating that the additi....