ITO-21(2)(2), MUMBAI vs. SHRI. LAXMMICHAND SHAH (HUF), MUMBAI

Aggrieved by the order of Ld. Commissioner of Income-Tax (Appeals)-33, Mumbai [in short ‘CIT(A)], Appeal No.CIT(A)- 33/Rg.21/349/2014-15 order dated 24/04/2019, the revenue is in further appeal before us. The Impugned order has restricted the addition on account of alleged bogus purchases to the extent of 15.5% of aggregate purchase of ₹4,33,992/- as against estimation of 25% as made by learned Assessing Officer.

Though, none appeared for the assessee, however, material on record was sufficient for disposal of the appeal. Therefore, the matter was proceeded-with on the basis of the material available on record. The Ld. DR sought restoration of estimation as made by Ld.AO.

During assessment proceedings, pursuant to receipt of certain information from Sale Tax Department, Maharashtra, it was alleged that the assessee procured bogus purchase bills of ₹4,33,992/- from an entity namely M/s Shree Amaaya Enterprises. No reply was received in response to notice u/s 133(6) of the Act. Accordingly, the learned Assessing Officer estimated the addition of 25% as against these purchase. Upon further appeal, the learned CIT(A) restricted the same to 15.5% being gross profit rate reflected by the assessee. Aggrieved, the revenue is in further appeal before us.

Upon careful consideration, we do not find any infirmity in the order of the learned CIT(A) in restricting the addition on account of alleged bogus purchase to the extent of gross profit rate reflected by the assessee during the year. The said estimation was a fair estimate of profit that may have been earned by the assessee by procuring bogus purchases bills since the sale turnover has not been disputed.

Resultantly, the appeal stands dismissed.