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 Mr. Trilok Chand Chaudhary, 39, Gadai Pur, Mehrauli, vs. ACIT Central Circle 26, New Delhi.
 Mr. Trilok Chand Chaudhary, 39, Gadai Pur, Mehrauli, vs. ACIT Central Circle 26, New Delhi.
 Jagmal Singh Village Khoh, VPO Manesar, Gurgaon Haryana vs. ITO Ward-2(2) Gurgaon
 Mrs. Shumana Sen, B-602, Plot No.F-2, The Crescent, Sector-50, Noida, Uttar Pradesh. vs. DCIT, Circle-64(1), New Delhi.
 Commissioner Of Income Tax Vs. M/S. Ansal Properties And Industries
 Binod Kumar Agarwala vs. CIT (Calcutta High Court)
 L&T Finance Limited vs. DCIT (Bombay High Court)
 Spice Mobility Ltd. 19A & 19B, Floor No. 5 Global Knowledge Park, Sector-125 vs. Addl. CIT(TDS) Noida
 ACIT, Central Circle-2, New Delhi. vs. Kanwar Singh Tanwar, 127, Asola Fatehpur Beri, New Delhi.
 ACIT Circle, Income Tax Office, Opp. Teacher’s Colony Bulandshahar vs. Zila Sahkari Bank Ltd. Moti Bagh Bulandshahar
 M/s. RL Travels Pvt. Ltd.,118, Ansal Bhawan,Kasturba Gandhi Marg,New Delhi - 110 001. vs. The DCIT, Central Circle-12 New Delhi.

ACIT vs. Steel Line (India) (ITAT Mumbai)
September, 11th 2017

 

We have considered rival contentions and carefully gone through the orders of the authorities below and also deliberated on the judicial pronouncements referred by lower authorities in their respective orders as well as cited by learned AR and DR during the course of hearing before us in the context of factual matrix of the case. From the record, we found that AO has made addition in respect of purchases found to be bogus as per the information from sales tax department. In the appellate proceedings, the CIT(A) recorded a finding to the fact that AO has not disputed the quantitative details and also day to day stock register maintained by the assessee. Assessee company being a trader of goods, AO not having doubted the genuineness of sales, could not have gone ahead and made addition in respect of peak balance on such purchases. Accordingly, CIT(A) concluded that issue boil down to find out the element of profit embedded in bogus purchases which the assessee would have made. When the corresponding sales have not been doubted and the quantitative details of purchases and sales vis-a-vis stock was available, we deem it appropriate considering the entirety of facts and circumstances of the case to restrict the addition to the extent of 2% of such bogus purchase. Accordingly, the order of both the lower authorities are modified and AO is directed to restrict the addition to the extent of 2% on such purchases.

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