ITO 33(1)(5), MUMBAI vs. SMT.HEENA AJAY PAREKH, MUMBAI

आदेश / O R D E R

PER: R.C. SHARMA, A.M. This appeal by the revenue is directed against the order dated

27/07/2018 of ld. CIT(A)-45, Mumbai for the A.Y. 2009-10 in the matter

of order passed u/s 143(3) r.w.s. 147 of the Income Tax Act, 1961 (in

short, the Act).

appeal, the revenue is aggrieved by the action of the ld. CIT(A) for

upholding the addition on account of purchases to the extent of 5.3%.

The facts in brief are that the assessee is engaged in the business of

2 ÏTA No. 6471/Mum/2018 Heena A Parekh Vs ITO trading of iron and steel. The A.O. got information regarding assessee

being involved in purchase of goods without actual delivery of goods,

accordingly, the assessment was reopened by issuing notice U/s 148 of

the Act and thereafter the A.O. made addition of Rs. 18,35,824/- in

respect of bogus purchases which is equivalent to 12.5% of alleged

bogus purchases. By the impugned order, the ld. CIT(A) confirmed the

addition to the extent of 5.3% after having the following observation:

“5.4 In the present case, the A.O. has noted in the assessment order in para 3 that the assessee has declared a gross profit of 7.2% in the P&L account and added 12.5% of the bogus purchases to the income declared. Respectfully following the order of the Hon’ble ITAT, Mumbai in the case of M/s Royal Enterprises, the assessing officer is directed to apply the differential percentage of 5.3% (12.5%-7.2%) on the bogus purchases of Rs. 1,46,86,682/-. In other words Rs. 7,78,394/- is confirmed out of the addition of “Rs. 18,35,824/-. Assessee gets part relief. The grounds of appeals are partly allowed.”

appeal before the ITAT.

that the addition made by the A.O. was directed to be upheld at 5.3% by

the ld. CIT(A) after considering the GP rate declared by the assessee at

7.2%. I found that the ld. CIT(A) has considered various judicial

pronouncements and accordingly whatever G.P. has been declared by

the assessee was directed to be reduced from the addition so made by

3 ÏTA No. 6471/Mum/2018 Heena A Parekh Vs ITO the A.O. Nothing was brought to our notice by the ld DR so as to

persuade me to deviate from the finding of the ld. CIT(A) for upholding

the addition of Rs. 5.3% of alleged bogus purchases. Accordingly, I

uphold the order of the ld. CIT(A).

Order pronounced in the open court on 6th December, 2019.

Sd/- (R.C.SHARMA) ACCOUNTANT MEMBER Mumbai; Dated 06/12/2019 *Ranjan

Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. The CIT(A), Mumbai. 4. CIT 5. DR, ITAT, Mumbai 6. Guard file.

स�या�पत ��त //True Copy// BY ORDER,

(Asstt. Registrar) ITAT, Mumbai