Shri Alap Shirishbhai Derasary, Baroda V. The ACIT.,Circle-2(1), Baroda

ITA 1101/AHD/2009

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 62955 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-09-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 08-08-2012
• Assessment Year: 2002-2003
• Appeal Filed On: 13-04-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAHUL KUMAR
• Assessee Lawyers: NIKITA BRAHMBHATT
• Keywords: Reopening of assessment; Bogus purchase; Opportunity of being heard
• Section: 234B; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD A BENCH BEFORE: SHRI D.K. TYAGI, JUDICIAL MEMBER AND SHRI T.R. MEENA, ACCOUNTANT MEMBER I.T.A. NOS.1101, 1102 & 1103/AHD/2009 A.Y. 2002-03, 03-04 & 04-05 SHRI ALAP SHIRISHBHAI DERASARY SHED NO.862/3 A, NEAR ABB CROSS ROAD, OPP. NEHA ENGINEERING, GIDC, MAKARPURA, BARODA PAN-ABOPD2194B APPELLANT VS. THE ACIT, CIRCLE-2(1), BARODA RESPONDENT DEPARTMENT BY : SHRI RAHUL KUMAR, SR. D.R. ASSESSEE BY : MS. NIKITA BRAHMBHATT, A.R. DATE OF HEARING : 08.08.2012 DATE OF PRONOUNCEMENT : 21.09.2012 / ORDER PER : D.K. TYAGI, JUDICIAL MEMBER THESE ARE ASSESSEES APPEAL AGAINST THE ORDER OF LD . CIT(A)-II, BARODA DATED 25.02.2009. THESE THREE APPEALS BELON G TO THE SAME ASSESSEE AND ASSESSEE HAS TAKEN COMMON GROUNDS IN THEM AND W ERE HEARD TOGETHER, WE ARE DECIDING THEM BY PASSING A CONSOLIDATED ORDE R TAKING THE FACTS OF ITA NO.1101/AHD/2009 FOR THE A.Y. 2002-03. ITA NO.1101/AHD/2009 2. THE COMMON GROUNDS TAKEN BY THE ASSESSEE ARE AS UNDER:- 1. THE LD. CIT(A) ERRED IN FACT AND IN LAW IN CONF IRMING THE ACTION OF THE AO IN RE-OPENING THE ASSESSMENT U/S 1 48 OF I.T. I.T.A. NOS.1101, 1102 & 1103/AHD/2009 A.Y. 2002-03, 03-04 & 04-05 2 ACT AND COMPLETING THE ASSESSMENT, COMMENCED UNDER INVALID EXERCISE OF POWER U/S 147 OF THE ACT. 2. THE LD. CIT(A) ERRED IN FACT AND IN LAW IN REJEC TING THE CONTENTION OF THE APPELLANT THAT THE ASSESSMENT FRA MED BY THE AO U/S 147 OF THE ACT WITHOUT PROVIDING COPY OF REA SON RECORDED IS NOT VALID UNDER LAW. 3. THE LD. CIT(A) ERRED IN FACT AND IN LAW IN CONFI RMING THE ACTION OF THE AO IN REOPENING THE ASSESSMENT BASED ON THE DOCUMENTS/PAPERS/AFFIDAVITS OF THIRD PARTIES NOT RE LEVANT IN THE CASE OF THE APPELLANT AND WITHOUT PROVIDING COPIES OF THE SAME TO THE APPELLANT FOR GIVING NECESSARY CLARIFICATION . 4. THE LD. CIT(A) ERRED IN FACT AND IN LAW IN CONFI RMING THE ACTION OF THE AO IN MAKING ADDITION TO THE INCOME O F THE APPELLANT WITHOUT PROVIDING THE COPIES OF THE DOCUMENTS/PAPERS/AFFIDAVITS REFERRED TO IN THE ASSE SSMENT ORDER BEFORE MAKING THE ADDITION. 5. THE LD. CIT(A) ERRED IN FACT AND IN LAW IN CONFI RMING THE ACTION OF THE AO IN MAKING THE ADDITION WITHOUT GIV ING PROPER OPPORTUNITY OF BEING HEARD IN THE MATTER. 6. THE LD. CIT(A) ERRED IN FACT AND IN LAW IN CONFI RMING THE ACTION OF THE AO IN DISALLOWING PURCHASES OF RS.4,1 0,165/- ON THE GROUND THAT THE SAID PURCHASES ARE BOGUS PURCHA SE DESPITE OF THE FACT THAT THE APPELLANT CONSUMED THE MATERIA L IN QUESTION. 7. THE LD. CIT(A) ERRED IN FACT AND IN LAW IN CONFI RMING THE ACTION OF THE AO IN CHARGING INTEREST U/S 234B OF T HE ACT. 8. THE LD. CIT(A) ERRED IN FACT AND IN LAW IN CONFI RMING THE ACTION OF THE AO IN INITIATING PENALTY PROCEEDING U /S 271(1)(C). 3. AT THE TIME OF HEARING GROUND NOS.1 TO 4, RELATI NG TO REOPENING OF ASSESSMENT U/S 148 OF THE I.T. ACT, WERE NOT SERIOU SLY PRESSED AND THEREFORE, THE SAME ARE DISMISSED. 4. GROUND NO.6 RELATES TO ADDITION OF RS.4,10,165/- . THE FACTS ABOUT THE ISSUE UNDER APPEAL, AS THEY EMERGED FROM THE OR DER OF LD. CIT(A), ARE AS UNDER:- I.T.A. NOS.1101, 1102 & 1103/AHD/2009 A.Y. 2002-03, 03-04 & 04-05 3 THE FIFTH GROUND OF APPEAL IS THAT THE LEARNED ASS ESSING OFFICER ERRED IN FACT AND IN LAW IN DISALLOWING PUR CHASE OF RS.4,10,165/- ON THE GROUND THAT THE SAID PURCHASES WERE BOGUS PURCHASES DESPITE THE FACT THAT THE APPELLANT CONSUMED THE MATERIAL IN QUESTION. VIDE LETTER DATED 03.02.200S IND SUBSEQUENT AFFIDAV IT DATED 09.02.2005, SHRI NAVIN RAVAL PROP, OF M/S. SHIV MET AL CORPORATION ADMITTED THAT HE WAS DOING THE BUSINESS OF ISSUING BOGUS ACCOMMODATION BILLS TO VARIOUS PARTIE S ON COMMISSION BASIS. THE PARTIES MADE PAYMENTS TO HIM BY CHEQUE, WHICH WAS DEPOSITED IN HIS BANK ACCOUNT, AN D AFTER ENCASHMENT, THE PAYMENT WAS RETURNED TO THE SAME PA RTY, IN CASH, AFTER DEDUCTING 1% COMMISSION, ON THE AMOUNT OF BOGUS / ACCOMMODATION BILLS ISSUED. IN RESPONSE TO THE SHOW CAUSE NOTICE, THE ASSESSEE SUBMITTED THA: THE PURCH ASES WERE MADE ON 4 OCCASIONS FROM M/S. SHIV METAL CORPO RATION AMOUNTING TO RS.4,10,170/-. PAYMENTS WERE MADE BY CHEQUE. THE ASSESSING OFFICER WAS NOT CONVINCED ABO UT THE SUBMISSIONS MADE BY THE ASSESSEE. SINCE HE FAILED T O PROVE THE GENUINENESS OF THE PURCHASE MADE, BY WAY OF BRI NGING CONFIRMATION FROM THE SELLER, OR, PRODUCING THE SEL LER IN PERSON FOR NECESSARY VERIFICATION, THE ASSESSING OF FICER DISALLOWED THE PURCHASE OF RS. 4,10,165/- AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE. IN APPEAL THE AUTHORIZED REPRESENTATIVE SHRI BHAVIN MARFATIA, CA SUBMITTED THAT THE PURCHASES MADE BY THE APPELLA NT WERE GENUINE AND NOT BOGUS. THE APPELLANT IS IN THE BUSI NESS OF MANUFACTURING TAILOR MADE MACHINE PARTS. MATERIAL P URCHASED FROM VARIOUS PARTIES, INCLUDING M/S. SHIV METAL COR PORATION, HAS BEEN USED IN EXECUTING THE WORK ORDERS, THE PUR CHASES MADE FROM M/S. SHIV METAL CORPORATION HAS BEEN USED IN EXECUTING THE SUPPLY ORDER OF M/S. GACL LTD. OF COA LESCER ELEMENTS & FILTER ELEMENTS. THE SAID MATERIAL WAS TRANSPORTED TO M/S, FLUID AIR FILTER SYSTEM, AHMEDA BAD. M/S. FLUID AIR FILTER SYSTEM HAS CONFIRMED RECEIPT OF MA TERIAL. THE MATERIAL WAS TRANSPORTED TO AHMEDABAD THROUGH M/S. R.K. CARTING SERVICE AS CAN BE SEEN BY THE TRANSPORT CHA LLANS. AFTER PROCESSING, THE SAID MATERIAL WAS DELIVERED T O GACL. IN VIEW OF THE ABOVE, AS PER THE LEARNED AUTHORIZED REPRESENTATIVE, IT CAN BE CONCLUDED THE PURCHASES M ADE BY THE APPELLANT ARE GENUINE. FURTHER THE PAYMENTS WER E MADE THROUGH ACCOUNT PAYEE CHEQUES AND THE SAID PARTIES ISSUED VALID BILLS. M/S. SHIV METAL CORPORATION POSSESSES VALID SALES TAX NUMBER. THE APPELLANT HAS USED THE MATERIAL FOR HIS BUSINESS PURPOSE. THE CONSUMPTION OF MATERIAL IS NO T I.T.A. NOS.1101, 1102 & 1103/AHD/2009 A.Y. 2002-03, 03-04 & 04-05 4 DOUBTED BY THE ASSESSING OFFICER. THERE IS NO FINDI NG THAT CASH HAS BEEN RECEIVED. RELIANCE WAS PLACED BY THE AUTHORIZED REPRESENTATIVE ON THE DECISION OF SAGAR BOSE VS. ITO 56 ITD 561 (CAL) AND THE - CIT VS. M.K. BROTHER S 163 ITR 249 (GUJ). I HAVE CONSIDERED THE ASSESSMENT ORDER AND THE SUBM ISSIONS OF THE AUTHORIZED REPRESENTATIVE. THE BASIC ISSUE I S THAT THE APPELLANT CLAIMS TO HAVE MADE PURCHASES FROM A PERS ON WHO STATES THAT NO SALES HAVE BEEN MADE BY HIM. NO EVID ENCE HAS BEEN ADDUCED BY THE APPELLANT TO SHOW THAT PURCHASE S WERE INDEED MADE FROM M/S. SHIV METAL CORPORATION. THE P ROP, OF M/S. SHIV METAL CORPORATION HAS SUBMITTED THAT HE H AS ONLY GIVEN ACCOMMODATION BILLS ON RECEIPT OF CROSSED BAN K CHEQUES AFTER DEDUCTION OF 1% COMMISSION. THE APPEL LANT HAS SOUGHT TO EXPLAIN THE PURCHASES FROM M/S. SHIV META L CORPORATION, BY SUBMITTING COPIES OF TRANSPORTATION BILLS, AS WELL AS CONFIRMATION FROM THE PROCESSING UNIT AT AH MEDABAD AND GACL. HOWEVER, NO EVIDENCE HAS BEEN PLACED ON R ECORD TO INDICATE THAT THE MOVEMENT OF GOODS THROUGH M/S. R.K. CARTING SERVICES ARE THE SAME GOODS WHICH ARE SAID TO HAVE BEEN PURCHASED FROM M/S. SHIV METAL CORPORATION. TH E ONUS LIES SQUARELY ON THE APPELLANT TO PROVE THE GENUIN ENESS OF HIS PURCHASES. IT IS NOT THE CASE OF THE ASSESSING OFFI CER THAT THE APPELLANT HAS NOT CONSUMED MATERIAL FOR PRODUCTION OF TAILOR MADE MANUFACTURING PARTS. THE ONLY THING WHICH REMA INS TO BE ESTABLISHED IS THAT MANUFACTURING HAS BEEN DONE FROM GOODS EXPRESSLY PURCHASED FROM M/S. SHIV METAL CORP ORATION. SINCE THE APPELLANT FAILED TO SO THE ASSESSING OFFI CER WAS JUSTIFIED IN MAKING THE ADDITION AND SAME IS THEREF ORE CONFIRMED. 5. AT THE TIME OF HEARING BEFORE US LD. COUNSEL OF THE ASSESSEE, AT THE OUTSET, SUBMITTED THAT THE ISSUE INVOLVED IN THESE APPEALS IS NOW COVERED BY THE VARIOUS DECISIONS OF THE I.T.A.T. IN SUPPORT O F THIS SUBMISSION, HE FILED COPIES OF THOSE CASE LAWS. LD. D.R. DID NOT SERIOU SLY OBJECT TO THIS SUBMISSION OF LD. COUNSEL OF THE ASSESSEE. 6. AFTER HEARING BOTH THE PARTIES AND PERUSING THE RECORD, WE FIND THAT THE A.O. HAD MADE AN ADDITION OF RS.4,10,165/- BY T REATING THE PURCHASES I.T.A. NOS.1101, 1102 & 1103/AHD/2009 A.Y. 2002-03, 03-04 & 04-05 5 MADE BY ASSESSEE FROM M/S. SHIV METAL CORPORATION A S BOGUS AS ASSESSEE FAILED TO ADDUCE ANY EVIDENCE TO SHOW THAT PURCHASE S WERE INDEED MADE FROM M/S. SHIV METAL CORPORATION. THERE WAS ALSO ADMISS ION ON THE PART OF THE PROP. OF M/S. SHIV METAL CORPORATION THAT HE HAS ON LY GIVEN ACCOMMODATION BILLS ON COMMISSION BASIS. ON SIMILAR FACTS, IN TH E CASE OF SHRI SATYANARAYAN P. RATHI VS. ITO VIDE ITS ORDER IN ITA NO. 3407/AHD /2009 FOR THE A.Y. 2003-04 THIS BENCH OF HONBLE I.T.A.T. HAS OBSERVED AS UNDE R:- 7. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS, THOROUGHLY PERUSED THE RELEVANT CASE RECORDS AND TH E VOLUMINOUS PAPER BOOK FURNISHED BY THE LD. A R DURI NG THE COURSE OF HEARING. AT THE OUTSET, WE WOULD LIKE TO RECALL THE FINDINGS OF THE EARLIER BENCHES ON A SIMILAR ISSUE. (I) ACIT CENTRAL CIRCLE 1(4) V. MARDIA COPPER EXTRU SION PVT. LTD IN ITA NO.4290/AHD/1995 - AY 1992-93: AFTER TAKING INTO ACCOUNT THE RIVAL SUBMISSIONS AND ALSO THE REASONING OF THE CIT (A), THE BENCH HAD OBSERVED TH US: '32. IT ONLY REMAINS FOR US TO CONSIDER, THE RATHER UNUSUAL OBSERVATION, IF WE MAY SAY SO WITH RESPECT, OF THE CIT (A) THAT IF IT IS FOUND THAT MAHAKALI ROADLINES HAVE NOT TRA NSPORTED THE GOODS, THEN THEY MIGHT HAVE BEEN TRANSPORTED BY SOM E OTHER TRANSPORTER AND THE ONLY THING WHICH THE AO CAN DO IS TO DISALLOW THE TRANSPORT CHARGES BUT NOT THE PURCHASE S. WE ARE TOTALLY UNABLE TO UNDERSTAND OR APPRECIATE THE LOGI C OF THE OBSERVATION. IF THE CLAIM OF TRANSPORTATION OF THE GOODS IS FOUND TO BE BOGUS OR NOT GENUINE, THE LOGICAL RESULT WOUL D NOT ONLY BE THAT THE TRANSPORTATION CHARGES SHOULD BE DISALLOWE D BUT SINCE THE FACT THAT THE GOODS WERE TRANSPORTED ITSELF STA NDS DISPROVED OR UNPROVED, THE PURCHASES ALSO STAND UNPROVED. IT IS NOT PROPER FOR THE CIT (A) TO GIVE THE BENEFIT OF DOUBT TO THE ASSESSEE, BY OBSERVING THAT THE GOODS MIGHT HAVE BE EN TRANSPORTED BY SOME OTHER TRANSPORTER. EVEN THE ASS ESSEE HAS NO CASE THAT THE GOODS WERE TRANSPORTED BY SOME OTH ER TRANSPORTER. THE CIT (A) IN OUR OPINION WAS NOT JUS TIFIED AT ALL IN MAKING THE AFORESAID OBSERVATION AND ALSO IN MAK ING IT PART OF HIS REASONING FOR DELETING THE DISALLOWANCE. I.T.A. NOS.1101, 1102 & 1103/AHD/2009 A.Y. 2002-03, 03-04 & 04-05 6 33. FOR THE ABOVE REASONS, WE REVERSE THE ORDER OF THE CIT (A) AND RESTORE THE DISALLOWANCE OF RS.51,08,219/-..... .' (II) YET ANOTHER SIMILAR ISSUE, THE EARLIER BENCH I N ITS RECENT FINDING IN THE CASE OF M/S. SHANKET STEEL TRADERS, VADODARA V. ITO, WARD 5(1), VADODARA IN ITA NOS.2801 & 2937/AHD /2008 DATED: 20.5.2011 HAS OBSERVED THUS: '9. SO FAR AS THE BOGUS PURCHASE IS CONCERNED, WE F IND THAT THE ASSESSING OFFICER RECORDED THE DETAILED FINDING SO AS TO ESTABLISH THAT THE PURCHASES CLAIMED TO HAVE BEEN M ADE FROM GIRNAR SALES CORPORATION AND SHIV METAL CORPORATION WAS BOGUS. THE LEARNED COUNSEL FOR THE ASSESSEE WAS UNA BLE TO CONTROVERT THE FACTUAL FINDING RECORDED BY THE AO I N THIS REGARD. HOWEVER, THERE IS NO DISPUTE THAT THE ASSES SEE IS ONLY A TRADER IN IRON AND STEEL AND IT HAS MAINTAINED QU ANTITATIVE DETAILS. THE STATEMENT MADE BY THE LEARNED COUNSEL THAT THE PURCHASES CLAIMED TO HAVE BEEN MADE BY THE ASSESSEE FROM GIRNAR SALES CORPORATION AND SHIV METAL CORPORATION IS DULY RECORDED IN THE BOOKS OF THE ASSESSEE AND HAS BEEN REFLECTED EITHER IN THE SALES OR IN THE CLOSING STOCK, IS NOT CONTROVERTED. ON THESE FACTS, THE DECISION IN THE CASE OF KULUBI STEEL [(SUPRA) - ACIT V. KULUBI STEEL - ITA NO.1568/AHD/2008] WOUL D BE SQUARELY (APPLICABLE) WHEREIN THE ITATHELD AS UNDER : '8. FROM THE ABOVE, IT IS EVIDENT THAT THE ASSESSEE DID NOT MAKE ANY EFFORT TO CONTROVERT THE FINDING RECORDED BY THE DDIT (INVESTIGATION) AND IT MADE NO EFFORTS TO PRODUCE T HE SELLER PARTIES ON THE OTHER HAND IT CLAIMED THAT IT IS NOT HIS RESPONSIBILITY TO PRODUCE THE SELLER. IT IS A SETTL ED LAW THAT ONUS IS ON THE ASSESSEE TO ESTABLISH THE GENUINENESS OF THE PURCHASE. THE ASSESSEE HAS PRODUCED VARIOUS EVIDENC ES WITH REGARD TO THE RECEIPT OF THE GOODS BY IT, I.E., STO CK REGISTER, RECEIPT OF WEIGH-BRIDGE FOR WEIGHMENT OF GOODS PURC HASED BY THE ASSESSEE, OCTROI RECEIPT FOR THE PAYMENT OF OCT ROI DUTY ETC. AFTER CONSIDERING THE ENTIRE MATERIAL, WE ARE OF TH E OPINION THAT THE ASSESSEE DID NOT PURCHASE THE GOODS FROM THE PA RTIES MENTIONED IN THE SALES BILL. AT THE SAME TIME, IT D ID PURCHASE THE GOODS FROM SOME OTHER SUPPLIERS, MAY BE WITHOUT BILL. THEREFORE, PURCHASE RATE AS MENTIONED IN THE ALLEGE D SALES BILL CANNOT BE ACCEPTED. ANY PERSON INDULGING IN THE PRA CTICE OF PURCHASING GOODS FROM THE GREY MARKET AND OBTAINING BOGUS BILLS OF SOME OTHER PARTIES, WOULD DO SO FOR GETTIN G SOME BENEFIT. BUT WHAT WOULD BE THE MAGNITUDE OF THE BEN EFIT WOULD DEPEND UPON FACTS OF EACH CASE. IN THE CASE OF VIJA Y PROTEINS, ITAT HELD THAT SUCH BENEFIT TO BE 25% AND THEREFORE SUSTAINED THE DISALLOWANCE FOR BOGUS PURCHASE AT 25%. IN THE CASE OF I.T.A. NOS.1101, 1102 & 1103/AHD/2009 A.Y. 2002-03, 03-04 & 04-05 7 SUN STEEL (SUPRA), THE ITAT DEEMED IT FIT TO SUSTAI N THE DISALLOWANCE FOR A LUMP-SUM AMOUNT OF RS.50000/-. H OWEVER, WE FIND THAT IN THE CASE OF SHRI ANUBHAI SHIVLAL (S UPRA), THE ITAT HAS CONSIDERED BOTH THE DECISIONS IN THE CASE OF VIJAY PROTEINS AND SUN STEEL (SUPRA) AND THEREAFTER SUSTA INED THE DISALLOWANCE AT 12.5%. RELEVANT FINDINGS OF THE ITA T IN THE CASE OF ANUBHAI SHIVLAL READ AS UNDER: '3.AT THE TIME OF HEARING BEFORE US, IT IS SUBMITTE D BY THE LEARNED COUNSEL THAT THE ADDITION SUSTAINED IS EXCE SSIVE. IN SUPPORT OF THIS CONTENTION HE REFERRED TO THE DECIS ION OF THE TRIBUNAL IN THE CASE OF ITO V. SUN STEEL 92 TTJ (AH D) 1126 WHEREIN THE TRIBUNAL HAS SUSTAINED THE ADDITION OF RS. 50,000/- ON ACCOUNT OF BOGUS PURCHASES. HOWEVER, WE FIND THA T THE FACTS IN THE ABOVE CASE WERE DIFFERENT. IN THE ABOVE CASE , THE ASSESSEE HAS SHOWN PURCHASES OF RS.27,39,410/-, SAL E OF RS.28,17,207/- AND GP AT RS.94,740/- THE ASSESSING OFFICER MADE THE ADDITION OF RS.27,39,407/- FOR BOGUS PURCH ASES. IF THE ABOVE SUM IS ADDED TO THE GP, THE GP WORKS OUT TO RS.28,34,1247/- (SIC) 28,34,1471-WHICH WAS MORE THA N THE SALE ITSELF. THE TRIBUNAL HELD THAT IT IS IMPOSSIBL E THAT THE GP IS MORE THAN THE SALE ITSELF. THE TRIBUNAL ALSO FOUND THAT THE ASSESSEE HAS MAINTAINED THE QUANTITATIVE DETAILS IN RESPECT OF MATERIALS PURCHASED AND SOLD. CONSIDERING PECULIAR FACTS OF THAT CASE, THE TRIBUNAL ARRIVED AT THE CONCLUSION THAT I T WOULD BE FAIR AND REASONABLE TO ESTIMATE THE ADDITION AT RS.50000 /- AS AGAINST THE ADDITION OF RS.27,39,407/- MADE BY THE ASSESSING OFFICER. HOWEVER, THE LEARNED COMMISSIONER OF INCOM E-TAX (APPEALS) CONSIDERING THE FACTS OF THE ASSESSEE'S C ASE, HAS SUSTAINED THE ADDITION AT 12.5%. WHILE DOING SO, HE HAS ALSO RELIED UPON THE DECISION OF THE TRIBUNAL IN THE CAS E OF M/S. VIJAY PROTEINS LTD., 55 TTJ (AHD) 76. IN THE CASE O F M/S. VIJAY PROTEINS LTD., THE TRIBUNAL HAS SUSTAINED THE ADDIT ION OF 25% OF THE BOGUS PURCHASES. HOWEVER, CONSIDERING THE FACTS OF THE ASSESSEE'S CASE, THE CIT (A) RESTRICTED THE DISALLO WANCE TO 12.5% AS AGAINST 25% MADE IN THE CASE OF M/S. VIJAY PROTEINS LTD. FROM THESE FACTS IT IS EVIDENT THAT THE CIT (A ) HAS SUSTAINED THE ADDITION AT 12.5% OF THE NON-GENUINE PURCHASES CONSIDERING THE FACTS OF THE ASSESSEE'S CASE. WE, T HEREFORE, DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE OR DER OF THE CIT (A) IN THIS REGARD. THE SAME IS SUSTAINED.' AFTER CONSIDERING THE FACTS AND THE ARGUMENTS OF BO TH THE SIDES, WE ARE OF THE OPINION THAT IT WOULD MEET THE ENDS OF JUSTICE, IF THE DISALLOWANCE IS SUSTAINED AT 12.5% OF THE PURCHASE FROM THESE TWO PARTIES. THE ASSESSING OFFI CER IS DIRECTED TO WORK OUT THE DISALLOWANCE ACCORDINGLY.' I.T.A. NOS.1101, 1102 & 1103/AHD/2009 A.Y. 2002-03, 03-04 & 04-05 8 SINCE THE FACTS OF THE ASSESSEE'S CASE ARE IDENTICA L, WE RESPECTFULLY FOLLOWING THE ABOVE DECISION OF THE IT AT, DIRECT THE ASSESSING OFFICER TO DISALLOW 12.5% OF THE PURCHASE MADE DURING THE YEAR UNDER CONSIDERATION'. 7.1. TAKING INTO ACCOUNT THE FACTS THAT THE PRESENT ASSESSEE WHO HAS BEEN MAINTAINING CASH BOOK, PURCHASE REGIST ER, SALES REGISTER, STOCK REGISTER, LEDGER ACCOUNT ETC., AND ALSO HIS CASE COMES UNDER THE PURVIEW OF THE PROVISIONS OF SECTIO N 44AB ACT, WE ARE OF CONSIDERED OPINION THAT HIS CASE IS SQUAR ELY COVERED BY THE RECENT DECISIONS OF THE EARLIER BENCHES (SUP RA) ON SIMILAR ISSUES. 7.2. IN AN OVER ALL CONSIDERATION OF THE FACTS OF T HE ASSESSEE'S CASE NARRATED ABOVE AND ALSO IN CONFORMITY WITH THE LATEST FINDINGS OF THE EARLIER BENCH (SUPRA), WE ARE OF TH E FIRM VIEW THAT IF THE DISALLOWANCE IS RESTRICTED/SUSTAINED TO THE EXTENT OF 12.5% ON ACCOUNT OF THE BOGUS PURCHASES, IT WOULD M EET THE ENDS OF JUSTICE. IT IS, THEREFORE, ORDERED ACCORDIN GLY. IN ESSENCE, THE REVENUE'S APPEAL IS DISMISSED. 7. IN VIEW OF THE ABOVE AND TO MEET THE ENDS OF JUS TICE, WE ARE OF THE CONSIDERED OPINION THAT DISALLOWANCE IN THE INSTANT CASE ALSO BE RESTRICTED TO THE EXTENT OF 12.5% OF THE BOGUS PURCHASES MADE BY ASSESSEE DURING THE YEAR UNDER APPEAL. WE HOLD ACCORDINGLY. 8. GROUND NOS.5, 7, 8 AND 9 ARE GENERAL IN NATURE A ND DO NOT REQUIRE ANY ADJUDICATION. 9. IN THE RESULT, ASSESSEES APPEALS ARE PARTLY ALL OWED. ORDER PRONOUNCED IN OPEN COURT ON 21.09.2012 SD/- SD/- (T.R. MEENA) (D.K. TYAGI) ACCOUNTANT MEMBER JUDICIAL MEMBER N.K. CHAUDHARY, SR. P.S. COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT I.T.A. NOS.1101, 1102 & 1103/AHD/2009 A.Y. 2002-03, 03-04 & 04-05 9 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD 6. THE GUARD FILE BY ORDER AR, ITAT, AHMEDABAD