Only 2% Net Profit on Unaccounted Sales Taxable: ITAT Mumbai

 Vodafone Idea Limited Vs ACIT (ITAT Mumbai) Conclusion:  Only the net profit element embedded in the unaccounted sales was taxable and directed the AO to compute the addition by applying a 2% net profit rate, recognising both direct and indirect business expenses evidenced by the seized material. Held: Pursuant to a search, AO found incriminating material indicating that assessee was engaged in unaccounted sales, purchases, salary payments and other business expenses. Based on seized material relating to a limited period, the AO extrapolated the unaccounted sales for the entire year and al...