Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, “G” BENCH, MUMBAI
Before: SHRI SAKTIJIT DEY, HONBLE & SHRI NARENDRA KUMAR BILLAIYA, HONBLE
OR DER \nPER NARENDRA KUMAR BILLAIYA, AM:\nI.T.A. No. 2807/Mum/2025 & two separate appeals by the assessee preferred against two\nseparate orders dt. 01/09/2023 by NFAC, Delhi [hereinafter “the\nld. CIT(A)"] pertaining to AYs 2011-12 and 2012-13 respectively.\n2.\nSince identical grievance is involved based on identical facts, both\nthe appeals were heard together and are disposed off by this common\norder for the sake of convenience and brevity.\n\nआयकर अपीलीय अधिकरण\nINCOME TAX APPELLATE TRIBUNAL\nI.T.A. No. 2807/Mum/2025\nΙ.Τ.Α. No. 2808/Mum/2025\n2\n3. The common ground involved in both the appeals relate to the\nassumption of gross profit @ 12.5% on the alleged bogus purchases.\n4.\nAt the very outset, it has been brought to our notice that the Co-\nordinate Bench in the assessee's own case in ITA No. 1783/Mum/2020\nvide order dated 08/10/2021 and in ITA No. 1784, 1785 & 1786/Mum/2020\nfor AY 2009-10, 2010-11 & 2011-12 vide order dated 25/11/2021 has\nrestricted the profit element at 1%. The relevant findings of the Co-\nordinate Bench in ITA No. 1783/Mum/2020, read as under:-\n“3.
We find that there is no dispute that assessee is trading in fabrics and that the\npurchases made from the aforesaid five suppliers were in respect of purchases of\nfabrics. It is not in dispute that the sales made out of purchases made from aforesaid\nfive suppliers were not doubted by the Revenue. It is not in dispute that purchase of\nfabrics does not get eligible for levy of VAT. Hence, the profit element to be estimated\non the value of ingenuine purchases should certainly exclude the VAT portion in the\ninstant case and only incidental benefit that assessee derives by making purchases\nout of cash in the grey market should be ultimately brought to tax. We find that under\nsimilar circumstances, the Co-ordinate Bench of this Tribunal in the case of Max\nRealties LLP vs. DCIT in and ITA No. 161/Mum/2020\nfor A.Y.2010-11 dated 16/08/2021 had estimated the incidental profit element at 1%.\nRespectfully following the said decision, we direct the Id. AO to add only 1% of value\nof ingenuine purchases of Rs.5,67,01,954/- (i.e. Rs.5,67,019/-) and delete the\nremaining portion. Accordingly, the ground raised
by the assessee is partly allowed.”\n5.\nThe Co-ordinate Bench in AY 2009-10, 2010-11 & 2013
14. (supra)\nhas followed the aforementioned findings of the Co-ordinate Bench in\nAY 2008-09.\n6. We are of the considered view that in earlier four assessment\nyears, the Co-ordinate Benches have taken a consistent view by\nrestricting the element of profit to 1%. Therefore, finding parity of facts,\nwe do not find any reason to differ with the findings of the Co-ordinate\n\nआयकर अपीलीय अधिकरण\nINCOME TAX APPELLATE TRIBUNAL\nI.T.A. No. 2807/Mum/2025\nΙ.Τ.Α. No. 2808/Mum/2025\n3\nBenches (supra). We accordingly the direct the AO to restrict the\naddition to 1%.\n7.\nIn the result, both the appeals of the assessee are partly allowed.\nOrder pronounced in the Court on 19th June, 2025 at Mumbai.\nSd/-\n(SAKTIJIT DEY)\nVICE PRESIDENT\nMumbai, Dated 19/06/2025\n*SC SPPS\nSd/-\n(NARENDRA KUMAR BILLAIYA)\nACCOUNTANT MEMBER\nआदेश की प्रतिलिपि अग्रेषित/