ITO 22 (2)(4), MUMBAI vs. SHRI. NIRMAL KUMAR PARASMAL JAIN, MUMBAI

This appeal by the Revenue is against the order of Commissioner of Income Tax (Appeals) -34, Mumbai [in short ‘the CIT(A)’] dated 13/05/2019 for the assessment year 2011-12.

Submissions made by ld. Departmental Representative heard, orders of the authorities below examined. The assessee is a retail trader of Aluminium and other hardware goods. In assessment proceedings under section 147 r.w.s. 148 of the Income Tax Act,1961 ( in short 'the Act'), the Assessing Officer held that during the period relevant to the assessment year under appeal, the assessee had obtained accommodation entries amounting to Rs.5,87,933/- from Vasundhara Enterprises. The assessee failed to prove genuineness of the purchases and the said dealer. Thus, the Assessing Officer made addition of Rs.1,46,983/- by estimating profit margin on bogus purchases @ 25%.

Against the assessment order dated 27/2/2016 passed under section 143(3) r.w.s. 147 of the Act, the assessee filed appeal before the CIT(A). The CIT(A) after examining the facts of case and considering various decisions rendered by the Hon'ble High Courts and various Benches of the Tribunal, restricted the addition to 12.5% of bogus purchases. I find no infirmity in the impugned order, the same is upheld and the appeal of Revenue is dismissed, sans merit.