ITO-20(2)(1), MUMBAI, MUMBAI vs. MUKESH KUMAR KISHOREMAL DOSHI, MUMBAI

Ms. Smita Verma representing the Department submitted that the assessee is a dealer in Aluminium Extrusions and Glass. The assessment in the case of the assessee for assessment year 2009-10 was reopened on the ground that the assessee has obtained bogus purchase bills amounting to Rs.1,02,19,926/- from six hawala dealers during the period relevant to the assessment year under appeal. During assessment proceedings the assessee

(A.Y 2009-10) could neither prove genuineness of the dealers nor purchases made from them. Thus, the Assessing Officer made addition of Rs.12,77,491/- by estimating profit margin of 12.5% on bogus purchases. In first appellate proceedings the CIT(A) restricted the addition to Rs.5,10,996/- by estimating profit at 5% of the bogus purchases. The ld.Departmental Representative prayed for restoring disallowance on bogus purchases made by the Assessing Officer .

Submissions made by ld.Departmental Representative heard, orders of authorities below examined. Undisputedly, the assessee failed to discharge his onus in proving genuineness of the dealers and the purchases made from them. At the same time it is observed that the Assessing Officer has not disputed the sales turnover declared by the assessee. The assessee has declared G.P rate of 3.67%. The same has been accepted by the Assessing Officer. Estimation of G.P @ 12.5% on alleged bogus purchases by the Assessing Officer is on higher side. The CIT(A) has estimated the profit margin of 5%. I concur with the findings of CIT(A). Hence, the impugned order warrants no interference, the same is upheld and the appeal of Revenue is dismissed being devoid of any merit.

In the result, appeal by the Revenue is dismissed.