The assessee is involved in the execution of Civil works like road construction etc .under the Public Works Department of the Government of Maharashtra and Municipal Corporation of the Government of Maharashtra . Based on the information received from the Sales Tax Department the Assessing Officer asked the assessee to explain purchases from twelve parties and was asked to produce the parties . The Assessee failed to do so . The Assessing Officer added the entire purchases as non -genuine expenditure . On appeal the CIT(A) restricted the addition by estimating profit of 12. 5% on the total purchases . On appeal the Tribunal up held the order of the CIT(A). On further appeal the High Court affirmed the order of the Tribunal . (AY. 2010-11) (ITA No. 398 of 2018 dt 18 -7- 2022 )
PCIT v. Ram Builders (2023) 146 taxmann.com 447 ( Bom)(HC) www.itatonline .org .
S. 69C : Unexplained expenditure –Income from undisclosed sources – Bogus purchases -Civil works – Road construction -Information from Sales Tax Department – Order of Tribunal estimated profit of 12.5% on unexplained and non -genuine purchases is affirmed by High Court .[ S. 37(1), 143(3), 260A]