Income Estimation in Circular Trading Fails Without Incriminating Evidence

Subhkaran & Sons Vs DCIT (ITAT Mumbai) ITAT Mumbai: Estimation of Income in Alleged Circular Trading—Additions Deleted for Lack of Evidence The Mumbai ITAT (C Bench) dealt with cross-appeals by Subhkaran & Sons and the Revenue for AYs 2013-14 to 2017-18 arising from search assessments under section 153A. The Assessing Officer alleged accommodation/circular trading using LC facilities and, after rejecting books under section 145(3), estimated additional income at 7% of turnover. The CIT(A) partly allowed relief by restricting the addition to 0.5% of sales, holding that regular trading...