Only profit element embedded in accommodation entry is to be taxed: ITAT Mumbai

ITO Vs Pravin Manilal Panchal (ITAT Mumbai) ITAT Mumbai held that entire bogus purchases can never be treated as income only profit element embedded in the accommodation entry is to be brought to tax. Accordingly, order of CIT(A) restricting disallowance @12.5% justified. Facts- The present appeal has been preferred by the revenue. It is contested that during assessment, AO disallowed 100% of purchases shown from alleged hawala dealers. However, CIT(A) erred in restricting the addition to the extent of 12.5%. Being aggrieved, revenue has preferred the present appeal. Conclusion- Held that enti...