Assessee was engaged in business of purchase and sale of gold from finance companies. Assessee disclosed commission income at rate of 1 per cent for total quantum of turnover of purchase and sale of gold. AO held that on account of failure of assessee to furnish details of said purchasers, income of assessee was to be estimated at 3.5 per cent of turnover of gold purchased and sold by him and not 1 per cent as disclosed by him. Tribunal affirmed the order of the AO. On appeal High court also affirmed the order of the Tribunal. (AY. 2013-14)
H. Abuthahir v. DCIT (2019) 265 Taxman 9 (Mag.) (Mad.)(HC)
S. 69A : Unexplained money–Purchase and sale of gold on behalf of other parties-Identity of purchasers was not established– Addition on estimate basis of 3.5% of turnover is held to be justified as against 1% disclosed by the appellant.