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“profit element”

DisallowancesSection 69CSection 69C5,654 judgments

The decision most relied on for profit element is CIT v. President Industries (258 ITR 654), cited in 471 judgments on BharatTax.

Leading authorities on profit element

CIT v. President Industries
258 ITR 654 · 2002 · High Court
471
citing judgments

When books of account are rejected and unaccounted sales or receipts are discovered, the income addition is restricted to the net profit element embedded in these undisclosed transactions, not the entire sale proceeds or receipts, especially if corresponding purchases are not proven to be outside the books.

Sanjay Oilcake Industries v. CIT
316 ITR 274 · 2009 · High Court
460
citing judgments

In cases of alleged bogus or unverifiable purchases, rather than disallowing the entire purchase value, a reasonable profit element or a proportionate percentage of the purchases should be added back to the assessee's income.

CIT v. Siemens Aktiongesellschaft
310 ITR 320 · 2009 · High Court
259
citing judgments

Reimbursements of actual expenses without any profit element are not taxable income. Additionally, mere amendments to the Income-tax Act do not override the provisions of Double Taxation Avoidance Agreements (DTAAs).

CIT v. Vijay M. Mistry Construction Ltd.
355 ITR 498 · 2013 · High Court
252
citing judgments

In cases of alleged bogus or hawala purchases where the existence of transactions is not entirely denied, only the profit element embedded in such purchases, and not the entire purchase price, can be added to the assessee's income. The focus is on determining a reasonable profit percentage for such additions.

CIT v. Balchand Ajit Kumar
263 ITR 610 · 2003 · High Court
212
citing judgments

When making an addition for unaccounted receipts, on-money, or non-genuine purchases/sales, the addition should be restricted to the estimated profit element embedded in such transactions, rather than the entire gross amount, particularly when evidence of corresponding expenditure is incomplete. This estimation often involves applying a net profit rate.

CIT v. Gurubachhan Singh J. Juneja
302 ITR 63 · 2008 · High Court
147
citing judgments

When unaccounted receipts or suppressed sales are detected and books of account are rejected under Section 145(3), additions to income must be restricted to the profit element embedded in such transactions, not the entire transaction value. This profit element is to be estimated by considering the assessee's regular profit ratio as per books of account.

Vijay Trading Co. v. ITO
388 ITR 377 · 2016 · High Court
119
citing judgments

When purchases are found bogus, only the profit element embedded therein, and not the entire purchase value, can be added to the assessee's income.

NK Proteins Ltd. v. DCIT
292 CTR 354 · 2017 · Supreme Court
115
citing judgments

When purchases are unverifiable or alleged to be bogus, only the profit element embedded in such transactions is taxable, not the entire purchase amount; the onus lies on the assessee to prove the genuineness of the transactions.

Judgments citing profit element

Pratik Enerprises, Mumbai vs. ITO 25(3)(2), Mumbai

In the result, appeal is allowed in part

ITA 2505/MUM/2017[2009-10]Status: DisposedITAT Mumbai09 Nov 2017AY 2009-10

Bench: Shri R.C.Sharma, Am Pratik Enterprises Vs. Ito – 25(3)(2),Mumbai 201, Shatrunjay Mahant Road, Vile Parle (E) Mumbai – 400 057 Pan/Gir No. Aajfp0010C Appellant) Respondent) ..

Section 143(3)

that lower authorities have not disputed the corresponding sales made by the assessee; however, they have restricted the addition to the extent of certain profit element having been embedded in such purchases. The CIT(A) has restricted the addition to the extent of 12.5% by relying on the decision

Chhaganlal S. Mehta, Mumbai vs. ITO-19(1)(3), Mumbai

In the result, appeal filed by the assessee for assessment year 2009-10 is dismissed

ITA 6138/MUM/2016[2009-10]Status: DisposedITAT Mumbai09 Nov 2017AY 2009-10

Bench: Shri Rajendra, Am & Shri Ram Lal Negi, Jm आिकर अपील सं./Ita No. 6138/Mum/2016 (धििाारण वर्ा / Assessment Year: 2009-10) Shri Chhaganlal S. Mehta, Vs. The Income Tax Officer, Prop. Mehta Metal Corporation, Ward 19(1) (3), 2Nd Khetwadi Lane, Room No. 220, 1St Floor, Near Alankar Cinema Varsha, Matru Mandir, Tardeo, Mumbai - 400007 Shop No. 5, Mumbai - 400004 स्थािी लेखा सं./जीआइआर सं./Pan/Gir No. : Aekpm5292E (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) यनर्ावररती की ओर से /Assessee By : Shri Rajesh Chamaria (Ar) राजस्व की ओर से / Revenue By : Shri Jenardhanan (Dr)

For Appellant: Shri Rajesh Chamaria (AR)For Respondent: Shri Jenardhanan (DR)
Section 143Section 143(3)Section 147Section 148

erred in sustaining an addition to the extent of 12.5% of the purchases, amounting to Rs. 19,05,703/- made as the profit element embedded in purchases from the alleged bogus parties on the ground that the motive of obtaining the bogus bills was inflation of purchases price ... assessee that the goods were genuinely purchased. Under these circumstances, the AO has rightly made addition in question keeping in view the profit element embedded in the purchases in question. 10. The Hon’ble Bombay High Court In CIT Vs. Nikunj Eximp Enterprises Pvt. Ltd. 372 ITR 619 (Bom), while

ITO 12(3)(3), Mumbai vs. M.S. Infraproject P.Ltd, Mumbai

In the result, appeal filed by the revenue for assessment year 2009-10 is partly allowed

ITA 5607/MUM/2016[2009-10]Status: PendingITAT Mumbai09 Nov 2017AY 2009-10

Bench: Shri Rajendra, Am & Shri Ram Lal Negi, Jm आिकर अपील सं./Ita No. 5607/Mum/2016 (धििाारण वर्ा / Assessment Year: 2009-10) The Ito-12(3)(3), Vs. M/S M.S. Infraproject Pvt. Ltd., Room No. 224, 2Nd Floor, G Wing, Flat No. 3, Aayakar Bhavan, M.K. Road, Ground Floor, Sumer Nagar – Mumbai - 400020 Building, S.V. Road, Behind Ajanta Party Hall, Borivali West, Mumbai - 400092 स्थािी लेखा सं./जीआइआर सं./Pan/Gir No. : Aabc17701C (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) राजस्व की ओर से / Revenue By : Sh. Saurabh Kumar Rai (Dr) यनर्ावररती की ओर से /Assessee By : Sh. Anil Thakrar (Ar) सुनर्ाई की तारीख / Date Of Hearing : 10/08/2017 घोषणा की तारीख/Date Of Pronouncement: 09/11/2017

For Appellant: Sh. Anil Thakrar (AR)For Respondent: Sh. Saurabh Kumar Rai (DR)
Section 129Section 133Section 133(6)Section 142Section 143Section 143(3)Section 144Section 147Section 148

books of account. Hence, there is no justification in making addition of the entire amount of bogus purchases determined by the AO. Under profit element embedded in the purchases in question. On the other hand the Ld CIT(A) has not given any cogent reason as to how 4% addition ... Seth 356 ITR 451(Guj) upheld the decision of the Tribunal and sustained the addition 12.5% of the total bogus purchases holding that only profit element embedded in such purchases can be added to income of the assessee. Hence, following the principles of law laid down

Mankeshwar Mechanical Works, Mumbai vs. Asst CIT 15(1), Mumbai

In the result, the appeal filed by the assessee is partly allowed

ITA 1223/MUM/2015[2010-11]Status: DisposedITAT Mumbai09 Nov 2017AY 2010-11

Bench: Shri G.S. Pannu & Shri Pawan Singhshri Mankeshwar A C I T 15(1) Mechanical Works [Presently Acit, Circle-20(3)] Shri Mankeshwar Bldg. Vs. 615, Piramal Chambers 110, B.N. Pai Marg Lalbaug, Parel Reay Road, Mumbai 400033 Mumbai 400012 Pan – Abcfs2901H Appellant Respondent

For Appellant: Shri Shailesh N. DoshiFor Respondent: Shri Suman Kumar
Section 143(3)Section 253

decided on 04.02.2015 also held that Revenue is not entitled to bring the entire sale consideration to tax, but only the profit element of such unrecorded sales consideration which alone can be subject to income tax. With these observations the grounds of appeal raised by the assessee are partly allowed

Debashish Chatterjee, Howrah vs. ITO, Ward 48(3), Kolkata

In the result, the appeal filed by the assessee in this appeal is allowed for statistical purposes

ITA 850/KOL/2017[2011-12]Status: DisposedITAT Kolkata08 Nov 2017AY 2011-12

Bench: Sri J. Sudhakar Reddyi.T.A. No. 850 & 1280/Kol/2017 (Assessment Year: 2011-12 & 2012-13 Respectively) Debashish Chatterejee…….......................…….………………….………………………………..………Appellant [Pan : Ackpc 0262 A] Ito, Ward-48(3), Kolkata………..….……………………………………………….…………………...Respondent Appearances By: Shri Manish Tiwari, Fca, Appeared On Behalf Of The Appellant. Shri Gautam Patra, Addl. Cit, Appeared On Behalf Of The Respondent. Date Of Concluding The Hearing : October 18, 2017 Date Of Pronouncing The Order : November 8, 2017 Order These Two Appeals By The Assessee Are Directed Against The Order Of The Ld. Commissioner Of Income Tax (Appeals)-14, (Hereinafter The ‘Ld. Cit(A)’), Dated 30.11.2016 & 30.03.2017 Passed U/S 143(3) Of The Income Tax Act, 1961 (The ‘Act’) For The Assessment Year 2011-12 & 2012-13 Respectively: 2. The Grounds Of Appeal In Ita No.850/Kol/2017 A.Y 2011-12 Read As Follows: “1. That On The Facts & In The Circumstances Of The Case, Ld. Cit(A) Having Admitted That Loans Received From Wife, Mother & Brother In Earlier Year & Conversion Of Such Loan Into Capital A/C In The Present Year Although Does Not Attract To Provisions Of Section 41(1) Of Income Tax Act, 1961 Tantamounts To Profit & Gain From Business Within The Meaning Of Section 28(Iv) Of Income Tax Act, 1961. 2. That On The Facts & In The Circumstances Of The Case, Ld. Cit(A) Has Erred In Directing The Assessing Officer To Consider The Action Of The Appellant To Convert The Loan Into Capital A/C Amounting To Rs.25,70,000/- As Income U/S 28(Iv) Of I.T. Act Instead Of U/S 41(1) Of I.T Act, 1961. 3. That On The Facts & In The Circumstances Of The Case, Ld. Cit(A) Is Wrong & Unjustified In Dismissing The Assessee’S Appeal.

Section 143(3)Section 28Section 41(1)

That on the facts and in the circumstances of the case, Ld. C.l.T(A) is wrong and unjustified in accepting only profit element of Rs. 1,49,3OO/- from total out of book sales of Rs. 5,84,572/- and thereby sustaining addition of Rs. 4,35,272/- as unexplained

DCIT, Circle - 23, Hooghly vs. M/S. Mitra Real Estate Pvt. Ltd., Kolkata

In the result, assessee’s CO is allowed

ITA 207/KOL/2016[2011-2012]Status: DisposedITAT Kolkata08 Nov 2017AY 2011-2012
Section 143(2)Section 144Section 44A

using, fixing or incorporating the same in the works, as in the case of materials other than those specified in Schedule "B", some profit element would be embedded in the turnover represented by the cost of such material but when stores/material was supplied by the Government department at fixed rates

ITO, WD-30(4), Kolkata vs. M/S S. L. D. Corporation, Kolkata

Accordingly, Ground No.5 raised by the Revenue is dismissed

ITA 1220/KOL/2014[2009-2010]Status: DisposedITAT Kolkata08 Nov 2017AY 2009-2010
For Appellant: Shri P. B. Pramanik, Addl. CITFor Respondent: Shri S.K. Tulsiyan, Advocate
Section 143(3)Section 194ISection 68

only considered the Profit & Loss A/c and by examining the same observed that no separate computation is required whereas the said net profit element was considered and included in the computation of net profit of the assessee. The ld. AR prayed to dismiss the ground. M/s. S. L. D Corporation

Muffazal Hakim Penwala, Mumbai vs. ITO 17(2)(4), Mumbai

In the result, this appeal filed by the assessee stands dismissed

ITA 3740/MUM/2017[2010-11]Status: DisposedITAT Mumbai08 Nov 2017AY 2010-11

Bench: Shri Shamim Yahya, Am & Shri Sandeep Gosain, Jm आयकर अपील सं./I.T.A. No. 3740/Mum/2017 ("नधा"रण वष" / Assessment Year: 2010-11) Shri Muffazal Hakim Penawala Cit(A)-28, India House, Ground Floor, Earnest House, Ncpa Marg, बनाम/ Shop No. 1-2, 246, A. R. Street, Nairman Point, Mumbai-400 021 Vs. Mumbai-400 003 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aabpp 1934 H (अपीलाथ" /Appellant) (""यथ" / Respondent) : अपीलाथ" क" ओर से / Appellant By : Ms. Ruchi M. Rathod ""यथ" क" ओर से/Respondent By : Shri M. V. Rajguru

For Appellant: Ms. Ruchi M. RathodFor Respondent: Shri M. V. Rajguru
Section 142(1)Section 143(2)Section 148

Nikunj Eximp Enterprises Private Limited (372 ITR 619). It was further submitted that for A.Y. 2009-10, the ld. CIT(A) has considered the profit element @ 4%, however for assessment year 2010-11, the same ld. CIT(A) has confirmed the profit element @ 6%. Accordingly, the ld. Counsel

ITO WD 5(3)(2), Mumbai vs. Shikha Diamonds P.Ltd, Mumbai

Accordingly this ground raised by the revenue is partly allowed

ITA 3302/MUM/2017[2007-08]Status: DisposedITAT Mumbai08 Nov 2017AY 2007-08

Bench: Shri R. C. Sharma, Am & Shri Sandeep Gosain, Jm आयकरअपीलसं./ I.T.A. No. 3302/Mum/2017, (निर्धारणवर्ा / Assessment Year: 2007-08)

For Appellant: Shri V. JustinFor Respondent: None
Section 132(4)Section 133(6)Section 143(1)Section 143(3)

Cake Industries (2009) 316 ITR 274 (Guj) (1C) and taking into consideration the facts of the present case, and to account for the profit element embedded in these purchase transactions to factorize profit earned by assessee against purchase of material in the grey market and undue benefit of VAT against

ITO 20(1)(4), Mumbai vs. Dilip Sukhraj Gowani, Mumbai

Appeal stands partly allowed

ITA 3254/MUM/2017[2009-10]Status: DisposedITAT Mumbai08 Nov 2017AY 2009-10

Bench: Shri Mahavir Singh, Jm & Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./I.T.A. No. 3254/Mum/2017 (िनधा"रण वष" / Assessment Year: 2009-10) Income Tax Officer 20(1)(4) Dilip Sukhraj Gowani Room No.112 Room No.3/4, Ground Floor बनाम/ Piramal Chamber Bulding No.15, Jayabhai Niwas Vs. 1St Floor, Parel S.P.Road, 7Th Lane, Kamathipura Mumbai – 400 012 Mumbai – 400 008 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Akhpg-6430-D (अपीलाथ" /Appellant) (""थ" / Respondent) : Dilip S. Gowani (Assessee-In-Person) Assessee By : Revenue By : Suman Kumar, Ld.Dr सुनवाई की तारीख / : 04/10/2017 Date Of Hearing घोषणा की तारीख / : 08/11 /2017 Date Of Pronouncement आदेश / O R D E R

For Appellant: Revenue byFor Respondent: Suman Kumar, Ld.DR
Section 133(6)Section 143(1)Section 143(2)Section 143(3)Section 147Section 148

served, which cast serious doubt on assessee’s claim. Therefore, in such a situation, the addition, which could be made, was to account for profit element embedded in these purchase transactions to factorize for profit element earned by assessee 4 Dilip Sukhraj Gowani Assessment Year 2009-10 against possible purchase

ITO 20(3)(5), Mumbai vs. Vision Enterprises, Mumbai

Accordingly this ground raised by the revenue is partly allowed

ITA 2422/MUM/2017[2011-12]Status: DisposedITAT Mumbai08 Nov 2017AY 2011-12

Bench: Shri R. C. Sharma, Am & Shri Sandeep Gosain, Jm आयकरअपीलसं./ I.T.A. No. 2422/Mum/2017, (निर्धारणवर्ा / Assessment Year: 2011-12)

For Appellant: Shri V. JustinFor Respondent: None
Section 147

Cake Industries (2009) 316 ITR 274 (Guj) (1C) and taking into consideration the facts of the present case, and to account for the profit element embedded in these purchase transactions to factorize profit earned by assessee against purchase of material in the grey market and undue benefit of VAT against

Sunil B. Vorani (HUF), Mumbai vs. ITO 20(3)(4), Mumbai

Accordingly these ground raised by the assessee is partly allowed

ITA 1337/MUM/2017[2009-10]Status: DisposedITAT Mumbai08 Nov 2017AY 2009-10

Bench: Shri R. C. Sharma, Am & Shri Sandeep Gosain, Jm आमकय अऩीर सं./I.T.A. No. 1337/Mum/2017 (निर्धारण वषा / Assessment Year: 2009-10)

For Appellant: Sh. Ruchi RathodFor Respondent: Ms. Arju Garodia
Section 143(1)Section 143(3)Section 147

present case, and also considering the order passed by the Coordinate Bench of SMC in assessee’s own case and to account for the profit element embedded in these purchase transactions to factorize profit earned by assessee against purchase of material in the grey market and undue benefit

ITO 25(3)(5), Mumbai vs. Nayan M Shah (HUF), Mumbai

Appeal stands dismissed whereas assessee’s cross objections stands partly allowed

ITA 6372/MUM/2016[2009-10]Status: DisposedITAT Mumbai08 Nov 2017AY 2009-10

Bench: Shri Mahavir Singh, Jm & Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./I.T.A. No. 6372/Mum/2016 (िनधा"रण वष" / Assessment Year: 2009-10) Income Tax Officer 25(3)(5) Nayan Narendra Shah (Huf) Room No.608,C-10 (Prop. Padme Wire Industries) बनाम/ 306/A, Shyamkamal Building 6Th Floor, Pratyakshkar Bhavan Vs. Tejpal Road, Vile Parle(E) Bkc Bandra (E) Mumbai – 400 057 Mumbai – 400 051 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aalhs-6023-E (अपीलाथ" /Appellant) (""थ" / Respondent) : & Cross Objection No.124/Mum/2017 (िनधा"रण वष" / Assessment Year: 2009-10) Nayan Narendra Shah (Huf) Income Tax Officer 25(3)(5) (Prop. Padme Wire Industries) Room No.608,C-10 बनाम/ 306/A, Shyamkamal Building 6Th Floor, Pratyakshkar Bhavan Vs. Tejpal Road, Vile Parle(E) Bkc Bandra (E) Mumbai – 400 057 Mumbai – 400 051 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aalhs-6023-E (अपीलाथ" /Appellant) (""थ" / Respondent) :

For Appellant: Dhiren P.Talati,Ld.ARFor Respondent: Suman Kumar, Ld.DR
Section 143(1)Section 143(2)Section 144Section 147Section 148

served, which cast serious doubt on assessee’s claim. Therefore, in such a situation, the addition, which could be made, was to account for profit element embedded in these purchase transactions to factorize for profit element earned by assessee against possible purchase of material in the grey market and undue

DCIT 15(3)(1), Mumbai vs. Topnotch Chemicals P.Ltd, Navi Mumbai

In the result, appeal filed by the revenue for assessment year 2011-12

ITA 6231/MUM/2016[2011-12]Status: DisposedITAT Mumbai08 Nov 2017AY 2011-12

Bench: Shri Rajendra, Am & Shri Ram Lal Negi, Jm आिकर अपील सं./Ita No. 6231/Mum/2016 (धििाारण वर्ा / Assessment Year: 2011-12) The Dcit 15(3)(1), Vs. M/S Topnotch Chemicals Room No. 451, 4Th Floor, Private Limited, Aaykar Bhavan, Plot No. C-116, Maharshi Karve Road, Ttc Industrial Area, Mumbai - 400020 Thane Belapur Road, Pawane Village, Navi Mumbai - 400705 स्थािी लेखा सं./जीआइआर सं./Pan/Gir No. :Aaact3865F (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) & प्रत्याक्षेप सं./Co No. 155/Mum/2017 (धििाारण वर्ा / Assessment Year: 2011-12) M/S Topnotch Chemicals Private Vs. The Dy. C.I.T. 15(3)(1), Limited, Room No. 451, 4Th Floor, Plot No. C-116, Aaykar Bhavan, Ttc Industrial Area, Maharshi Karve Road, Mumbai - 400020 Thane Belapur Road, Pawane Village, Navi Mumbai - 400705 स्थािी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaact3865F (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) राजस्व की ओर से /Revenue By : Shri V. Jenardhanan (Dr) यनर्ावररती की ओर से /Assessee By : Dr. P. Daniel (Ar) सुनर्ाई की तारीख / Date Of Hearing : 14/08/2017 घोषणा की तारीख/Date Of Pronouncement: 08/11/2017 आदेश / O R D E R Per Ram Lal Negi, Jm The Present Appeal & Cross Objection Have Been Filed By The Revenue & The Assessee Respectively Against Order Dated 18/08/2016 Passed By The 2 Ita No. 6231/Mum/2016 & Co No. 155/Mum/2017 Assessment Year: 2011-12

For Appellant: Dr. P. Daniel (AR)For Respondent: Shri V. Jenardhanan (DR)
Section 133Section 143Section 147Section 148

6231/MUM/2016 & CO No. 155/Mum/2017 Assessment Year: 2011-12 AO. Under these circumstances, the AO ought to have made addition keeping in view the profit element embedded in the purchases in question. 8. The Hon’ble Bombay High Court In CIT Vs. Nikunj Eximp Enterprises Pvt. Ltd. (supra), while upholding ... Seth 356 ITR 451(Guj) upheld the decision of the Tribunal and sustained the addition 12.5% of the total bogus purchases holding that only profit element embedded in such purchases can be added to income of the assessee. Hence, following the principles law laid down by the Hon’ble High

Popatlal N. Shah, Mumbai vs. ACIT - 19(2), Mumbai

The appeal of the revenue is dismissed in terms of our said observations

ITA 5939/MUM/2016[2012-13]Status: DisposedITAT Mumbai08 Nov 2017AY 2012-13

Bench: Shri B.R.Baskaran, Am & Shri Ravish Sood, Jm Popatlal N. Shah Acit 19(2), बिधम/ 1802, Panchratna, Income Tax Office, Opera House, Matru Mandir, Tardeo Vs. Mumbai- 400004. Mumbai. स्थायी लेखा सं./जीआइआर सं./ Pan No. Aaafpo468K (अऩीराथी /Assessee) (प्रत्मथी / Revenue) : The Acit-19(2), M/S Popatlal N. Shah, बिधम/ Room No. 207, 1802, Panchratna, Opera Matru Mandir, House Mumbai 400051 Vs. Mumbai-400 007 स्थायी लेखा सं./ जीआइआर सं./ Pan No. Aaafpo468K (अऩीराथी /Revenue) (प्रत्मथी / Assessee) :

For Appellant: Mrs. Aarti Visangi, A.RFor Respondent: Ms. Pooja Swaroop, D.R
Section 143(1)Section 143(2)Section 143(3)

assessee to have been made from the aforesaid dummy concerns of Bhanwarlal Jain Group. The A.O in order to support his estimation of the profit element, took support of the Benign assessment procedure (BAP) which was applicable to the diamond merchants who were showing a profit margin ... from purchasing of the goods under consideration from the open/grey market. However, the CIT(A) did not find favour with the quantification of the profit element by the A.O @ 8% of the aggregate value of the purchases which were claimed by the assessee to have been made from the aforementioned

ACIT 13(2)(1), Mumbai vs. Say India Jewellers P. Ltd, Mumbai

Appeal stands dismissed

ITA 5667/MUM/2016[2007-08]Status: DisposedITAT Mumbai08 Nov 2017AY 2007-08

Bench: Shri D.T. Garasia, Jm & Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./I.T.A. No.5667/Mum/2016 (िनधा"रण वष" / Assessment Year: 2007-08) Assistant Commissioner Of Say India Jewellers Private Ltd. Income Tax-13(2)(1) Unit No.701, Block 1, Seepz++ बनाम/ Roomno.146,1Stfloor Sez, Andheri(E) Vs. Aaykar Bhavan, M.K.Road Mumbai-400 096 Mumbai-400 020 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaacm-7171-K (अपीलाथ" /Appellant) (""थ" / Respondent) :

For Appellant: Amod Prabhudesai,Ld.ARFor Respondent: Suman Kumar, Ld. Sr. DR
Section 132(4)Section 143(2)Section 143(3)Section 147Section 148

which was followed by statutory notices u/s 143(2) and 142(1). 2.3 During assessment proceedings, the assessee, inter-alia, pleaded for addition of profit element embedded in such purchase transactions. However, not convinced, Ld. AO concluded that the assessee failed to discharge the onus casted on him to prove ... which cast a serious doubt on assessee’s claim. Therefore, in such a situation, the addition, which could be made, was to account for profit element embedded in these purchase transactions to factorize for profit element earned by assessee against possible purchase of material in the grey market and undue

DCIT Cent. Cir. 4(2), Cent. Range - 4, Mumbai vs. Saryu Properties and Hotels Pvt. Ltd., Mumbai

Appeal stands dismissed

ITA 5272/MUM/2016[2011-12]Status: DisposedITAT Mumbai08 Nov 2017AY 2011-12

Bench: Shri D.T. Garasia, Jm & Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./I.T.A. No.5272/Mum/2016 (िनधा"रण वष" / Assessment Year: 2011-12) Deputy Commissioner Of Saryu Properties & Hotel Income Tax Private Limited Central Circle-4(2) Plot No.25,B-Wing बनाम/ Room No.1918,19Th Floor Girnara, Pali Mala Road Vs. Air India Building Pali Hill, Bandra(W) Nariman Point Mumbai-400 050 Mumbai-400 021 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaacs-6983-M (अपीलाथ" /Appellant) (""थ" / Respondent) :

For Appellant: Vinay Sinha ,Ld.ARFor Respondent: Suman Kumar, Ld. DR
Section 133(6)Section 143(2)Section 143(3)Section 147Section 148

addresses, which cast serious doubt on assessee’s claim. Therefore, in such a situation, the addition, which could be made, was to account for profit element embedded in these purchase transactions to ITA.No.5272/Mum/2016 Saryu Properties and Hotel Private Limited Assessment Year-2011-12 factorize for profit element earned

DCIT - 9(1)(1), Mumbai vs. Ace Energy Infrastructure Pvt. Ltd., Mumbai

Appeal stands dismissed

ITA 5181/MUM/2016[2009-10]Status: DisposedITAT Mumbai08 Nov 2017AY 2009-10

Bench: Shri D.T. Garasia, Jm & Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./I.T.A. No.5181/Mum/2016 (िनधा"रण वष" / Assessment Year: 2009-10) Deputy Commissioner Of Ace Energy Infrastructure Income Tax 9(1)(1) Private Limited बनाम/ Room No.260-A,2Nd Floor 4, Stanburg Estate, Juhu Vs. Aaykar Bhavan,M.K.Road Koliwada,Santacruz(W) Mumbai-400 020 Mumbai-400 049 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aagca-2093-N (अपीलाथ" /Appellant) (""थ" / Respondent) :

For Appellant: Aarthi Sathe ,Ld.ARFor Respondent: Suman Kumar, Ld. DR
Section 133(6)Section 143(1)Section 143(2)Section 143(3)Section 147Section 148

served, which cast serious doubt on assessee’s claim. Therefore, in such a situation, the addition, which could be made, was to account for profit element embedded in these purchase transactions to factorize for profit element earned by assessee against possible purchase of material in the grey market and undue

DCIT 28(2), Navi Mumbai vs. Om Developers, Navi Mumbai

Appeal stands dismissed

ITA 5849/MUM/2015[2010-11]Status: DisposedITAT Mumbai08 Nov 2017AY 2010-11

Bench: Shri Mahavir Singh, Jm & Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./I.T.A. No.5849/Mum/2015 (िनधा"रण वष" / Assessment Year: 2010-2011) Deputy Commissioner Of Om Developers Income Tax 28(2) Off. No.14 बनाम/ 3Rd Floor, Tower No.6 Mahavir Centre Vashi Railway Station Complex Vs. Sector-17,Vashi Vashi Navi Mumbai-400 705 Navi Mumbai-400 703 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaafo-9862-A (अपीलाथ" /Appellant) (""थ" / Respondent) :

For Appellant: NoneFor Respondent: Rajat Mittal, Ld. DR
Section 133(6)Section 143(3)

served, which cast serious doubt on assessee’s claim. Therefore, in such a situation, the addition, which could be made, was to account for profit element embedded in these purchase transactions to factorize for profit element earned by assessee against possible purchase of material in the grey market and undue

Prithviraj G. Jain, Mumbai vs. ITO WD 19(2)(5), Mumbai

In the result, appeals of the assessee are partly allowed

ITA 3057/MUM/2017[2011-12]Status: DisposedITAT Mumbai03 Nov 2017AY 2011-12

Bench: Shri C.N. Prasad, Hon'Ble & Shri G. Manjunathan, Hon'Ble

For Appellant: Shri Rajiv KhandelwalFor Respondent: Shri M.V. Rajguru
Section 133(6)Section 143(1)Section 143(3)Section 145(3)Section 147

3057/MUM/2017 Prithviraj G.Jain as according to the Assessing Officer the entries and the Books of Accounts cannot be relied on. He estimated the profit element in the purchases at 12.5% of the said purchases from those parties and was treated as suspicious purchases and added to the income ... sold the finished goods as a natural corollary not the entire amount covered under such purchases would be subject to tax but only the profit element embedded therein. Similar view has been taken by the Hon'ble Gujarat High Court in the case of CIT v. Simit P. Seth