TaxTMI 
TaxTMI 
2022 (9) TMI 972
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.... the assessment years 2009-10 and 2010-11. 2. Since, identical issue is involved, therefore, both the appeals are taken up together and disposed off by this common order for the sake of convenience. With the consent of both the parties, the appeal of the assessee for the assessment year 2009-10 was taken up as the lead case and the decision rendered therein would apply with equal force in appeal for assessment year 2010-11, except with variance in figures. ITA No. 559/Mum./2022 Assessee's Appeal - A.Y. 2009 - 10 3. In this appeal, the assessee has raised following ground: "1. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in confirming addition of Rs.8,60,860, which was 12.50% of alleged bogus p....
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....ces, the assessee was also given an opportunity to establish the genuineness of these parties and the purchases made from them with adequate supporting evidences and also requested to produce the parties along with their books of accounts as these parties were found to be non-existent. However, despite the aforesaid opportunity, the assessee could not produce these parties nor furnished new addresses of these parties. The assessee furnished copies of Ledger accounts in the books of the assessee, purchase bills and assessee"s bank statement showing the payment made through bank. The Assessing Officer ("AO") also sought of the details viz. details of transportation of goods i.e. lorry receipts, documentary evidence regarding the relevant entr....
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....he assessee paid the VAT liability under the amnesty scheme declared by the Government of Maharashtra. Thus, it was submitted that the addition in the present case should only be restricted to the percentage of the VAT amount sought to be defaulted by the vendors. The learned AR submitted that the decision of Hon"ble Gujarat High Court relied upon by the lower authorities deal with facts relevant for State of Gujarat, wherein the rate of VAT is different. 8. On the other hand, learned Departmental Representative vehemently relied upon the orders passed by the lower authorities. 9. We have heard the rival submissions and perused the material available on record. In the present case, on the basis of information received from investigation w....
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....eing the position, the only question that survives is what should be the fair profit rate out of the bogus purchases which should be added back to the income of the assessee. The Commissioner adopted the ratio of 30 per cent of such total sales. The Tribunal, however, scaled down to 12.5 per cent. We may notice that in the immediately preceding year to the assessment year under consideration the assessee had declared the gross profit at 3.56 per cent of the total turnover. If the yardstick of 30 per cent, as adopted by the Commissioner (Appeals), is accepted the gross profit rate will be much higher. In essence, the Tribunal only estimated the possible profit out of purchases made through non-genuine parties. No question of law in such esti....
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...., placed reliance upon the aforesaid decision of Hon"ble Gujarat High Court to restrict the disallowance to 12.5% without appreciating the basis on which such percentage of addition was arrived at in the facts of that case. In the present case, reliable industry data was also not brought on record to prove the prevailing profit margin of the ferrous and non-ferrous industry during the relevant assessment year. Therefore, in view of the aforesaid findings, we deem it fit to modify the impugned order only to the extent that the disallowance on account of bogus purchases should be restricted to the total of rate of VAT applicable during the year under consideration in the State of Maharashtra on the goods traded by the assessee and gross profi....