INCOME TAX OFFICER-26(2) (3), MUMBAI , MUMBAI vs. JUZER ABDULLABHAI KANCHWALA , MUMBAI

At the time of hearing when the case was called for hearing, neither assessee nor his authorised representative was present to attend the hearing nor any application for adjournment was filed. Therefore, we are deciding the appeal of the Revenue after hearing the Ld. D.R. and after considering the merits of the case.

The facts in brief are that the assessee filed the return of income on 28.09.2011 declaring total income of Rs.13,85,600/- which was processed under section 143(1) of the Act. The case of the assessee was thereafter reopened by the AO after receipt of information from DGIT (Inv.), Mumbai that assessee is beneficiary of hawala purchase entries to the extent of Rs.7,71,135/- and accordingly the notice under section 148 of the Act was issued on 20.03.2014. The AO called for various details and information from the assessee from time to time during the course of assessment proceedings which were not furnished before the AO. The AO finally rejected the contentions of the assessee and treated the purchases as non genuine thereby making an addition of being 100% of the purchases of Rs.7,71,135/- to the income of the assessee by framing ex-parte assessment under section 144 read with section 147 of the Act dated 07.03.2016.

In the appellate proceedings, the Ld. CIT(A) partly allowed the appeal of the assessee by directing the AO to apply rate of 12.5% of the bogus purchases by following the decision of CIT vs. Simit P. Sheth (2013) 356 ITR 451 (Guj) by holding that only profit embedded in the bogus purchases can be brought to tax and not the entire purchases.

After hearing the Ld. D.R. and perusing the material on record, we observe that Ld. CIT(A) has passed the appellate

In the result, the appeal of the Revenue is dismissed.