MUFFAZAL HAKIM PENWALA, MUMBAI V. ITO 17(2)(4), MUMBAI

ITA 3740/MUM/2017

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8481 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 23-05-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M V RAJGURU
• Keywords: Bogus purchase; Gross profit estimation; Accommodation entries; Reason to believe
• Section: 142(1); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL L BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA, A M AND SHRI SANDEEP GOSAIN, JM ./ I.T.A. NO. 3740/MUM/2017 ( / ASSESSMENT YEAR: 2010 - 11 ) SHRI MUFFAZ AL HAKIM PENAWALA INDIA HOUSE, GROUND FLOOR, SHOP NO. 1 - 2, 246, A. R. STREET, MUMBAI - 400 003 / VS. CIT(A) - 28, EARNEST HOUSE, NCPA MARG, NAIRMAN POINT, MUMBAI - 400 021 ./ ./ PAN/GIR NO. AABPP 1934 H ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : MS. RUCHI M. RATHOD / RESPONDENT BY : SHRI M. V. RAJGURU / DATE OF HEARING : 25.10.2017 / DATE OF PRONOUNCEMENT : 08.11. 2017 / O R D E R PER SHAMIM YAHYA , A. M.: THIS A PPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 28 , MUMBAI (CIT(A) FOR SHORT) DATED 03.03.2017 AND PERTAINS TO THE ASSESSMENT YEAR (A.Y.) 2010 - 11. 2. THE GROUND S OF APPEAL READ AS UNDER: 2 ITA NO. 3740/MUM/2017 (A.Y. 2010 - 11) SHRI MUFFAZAL HAKIM PENAWALA VS. CIT(A) 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE: THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) WAS JUSTIFIED IN SUSTAINING THE ADDITION ON ACCOUNT OF LOW GROSS PROFIT MARGIN @ 6% ON ALLEGED BOGUS PURCHASES OF RS .41,32,032/ - . 3. IN THIS CASE, THE REASSESSMENT WAS O P E N ED BY THE ASSESSING OFFICER BY OBSERVING AS UNDER: 2. ON RECEIPT OF INFORMATION FR OM THE DGIT (INVESTIGATION), MUM BAI, IT CAME TO LIGHT THAT THE ASSESSEE HAD MADE PURCHASES FROM THE FOLLOWING SUSPI CIOUS PARTIES / HAWALA PARTIES DURING THE FINANCIAL YEAR 2009 - 10, RELEVANT TO ASSESSMENT YEAR 2010 - 11, THE DETAILS OF WHICH ARE AS FOLLOWS: SR.NO . HAWALA NAME HAWALA TIN HAWALA PAN AMOUNT (RS.) 1 KRISH CORPORATION 27890 606S33V AWAPS3678L 12,01,868 2 N B ENTERPRISE 27490339033V AAYPL7154J 13,32,652 3 BATH CLASSIC 27200603178V AGAPA9867F 41,83,937 4 MILLENIUM ENTERPRISES 27730160615V AEIPD0358N 49,53,390 5 MODERN TRADERS 27030613796V AKUPD2221J 57,16,232 6 NAVDEEP TRADING CORPN, 27540616280V AA APV4487A 2,53,410 7 SHUBHLAXRM SALES CORP. 27490615192V AAVPS13338 8,63,309 8 KLUDEE SAFES 2759052900SV AFMPK3184Q 20, 17,358 9 PARAS (INDIA) 27720576508V AAJFP1442N 21,12,965 10 CRESCENT TRADING 27960517885V ACKPN0476B 22,20,021 11 SOUVENIER HARDWARE & TOOLS 27 8 20160614V AIMPB5542L 38,69,039 L2 GREAT INTERNATIONAL 27680504653V 43,32,082 TOTAL 3,30,56,263 3. IN VIEW OF THE ABOVE AND ON BEING SATISFIED, THE ASSESSEES CASE FOR A.Y. 2010 - 11 WAS REOPENED BY ISSUING NOTICE U/S. 148 OF THE IT ACT ON 17 - 03 - 2015 (WHICH WAS DULY SERVED ON THE ASSESSEE ), AFTER RECORDING REASONS FOR REOPENING THE ASSESSMENT. NOTICE U/S 142(1) ALONG WITH QUESTIONNAIRE AND NOTICE U/S 143(2) OF THE I .T, ACT WERE ISSUED TO THE ASSESSEE. THE REASONS RECORDED FOR REOPENING THE ASSESSMENT ARE REPRODUCED AS FOLLOWS FOR THE SAKE OF READY REFERENCE AND CONVENIENCE. 'IN THIS C A SE , THE INFORMATION AVAILABLE SHOWS THAT THE ASSESSEE HAS TAKEN ENTRIES OF BOGUS PURCHASES FROM THE FOLLOWING PARTIES/'ENTITIES DURING THE FINANCIAL YEAR RELEVANT TO ASSESSMENT YEAR UNDER CONSIDERATION. 3 ITA NO. 3740/MUM/2017 (A.Y. 2010 - 11) SHRI MUFFAZAL HAKIM PENAWALA VS. CIT(A) HAWALA TIN HAWALA NAME HAWALA PAN F.Y. AMOUNT (RS.) 27890 606S33V KRISH CORPORATION AWAPS3678L 2009 - 10 12,01,868 27490339033V N B ENTERPRISE AAYPL7154J 2009 - 10 13,32,652 27200603178V BATH CLASSIC A GAPA9867F 2009 - 10 41,83,937 27730160615V MILLENIUM ENTERPRISES AEIPD0358N 2009 - 10 49,53,390 27030613796V MODERN TRADERS AKUPD2221J 2009 - 10 57,16,232 27540616280V NAVDEEP TRADING CORPN, AAAPV4487A 2009 - 10 2,53,410 27490615192V SHUBHLAXRM SALES CORP. AA VPS13338 2009 - 10 8,63,309 2759052900SV KLUDEE SAFES AFMPK3184Q 2009 - 10 20, 17,358 27720576508V PARAS (INDIA) AAJFP1442N 2009 - 10 21,12,965 27960517885V CRESCENT TRADING ACKPN0476B 2009 - 10 22,20,021 27 8 20160614V SOUVENIER HARDWARE & TOOLS AIMPB5542L 2009 - 10 38,69,039 27680504653V GREAT INTERNATIONAL 2009 - 10 43,32,082 TOTAL 3,30,56,263 ANALYSIS OF THE INFORMATION REVEALS THAT THE ABOVE ENTITIES/PARTIES ARE NON - GENUINE AND ARE PROVIDERS OF BOGUS BILLS WITHOUT ACTUAL DELIVERY OF GOODS. THE ABOVE ENTIT IES/PARTIES HAVE BEEN PROCLAIMED AS 'HAWALA DEALERS' BY THE SALES TAX DEPARTMENT, MAHARASHTRA, FURTHER, THE ANALYSIS OF THE INFORMATION RECEIVED FROM THE DGIT (INV.), MUMBAI AND THE INFORMATION AS AVAILABLE IN THE PUBLIC DOMAIN ON THE WEBSITE OF THE SALES TAX AUTHORITIES, REVEALS THAT THE ABOVE ENTITIES/PARTIES ARE PROVIDERS OF BOGUS BILLS. THE ABOVE PARTIES/ENTITIES ARE FOUND TO HAVE ISSUED BOGUS BILLS TO THE ASSESSEE WITHOUT DELIVERY OF GOODS. FURTHER, FROM THE EVIDENCES, A S GATHERED BY THE INVESTIGATION WING, IT HAS EMERGED THAT THE PURCHASES MADE BY THE ASSESSEE FROM THE ABOVE ENTITIES/PARTIES ARE NON - GENUINE AND THE ASSESSEE HAS TAKEN ACCOMMODATION ENTRIES OF BOGUS PURCHASES FROM THE AFORESAID PARTIES/ENTITIES TO SUPPRESS HIS INCOME FOR THE ASSESSMENT Y EAR UNDER CONSIDERATION. IN VIEW OF THE ABOVE, I HAVE REASON TO BELIEVE THAT IN THE CASE OF THE ASSESSEE, INCOME CHARGEABLE TO TAX IN THE GARB OF ABOVE ALLEGED PURCHASES BY WAY OF ACCOMMODATION ENTRIES FROM THE AFORESAID ENTITIES/PARTIES TO THE TUNE OF RS .3,30,56,263/ - HAS ESCAPED ASSESSMENT FOR A.Y.2010 - 11 WITHIN THE MEANING OF SECTION 147 OF THE I .T. ACT, 1961. CONSEQUENTLY, ASSESSMENT IN THE ` OF THE ASSESSEE FOR A.Y. 2010 - 11 IS ACCORDINGLY REOPENED U/S 147 OF ME TAX ACT, 1961.' 4. IN THE COURSE OF ASS ESSMENT PROCEEDINGS, O N ASSESSING OFFICERS QUERIES ISSUED TO THE ASSESSEE, THE ASSESSEE DID NOT SUPPL Y ANY PURCHASE BILL STATING THAT THE SAME WERE SEIZED BY THE SALES TAX DEPARTMENT. THE ASSESSING OFFICER FURTHER NOTED THAT THE 4 ITA NO. 3740/MUM/2017 (A.Y. 2010 - 11) SHRI MUFFAZAL HAKIM PENAWALA VS. CIT(A) ASSESSEE HAS NOT COME FORW ARD WITH ANY DIRECT OR INDIRECT EVIDENCE SUCH AS PURCHASE BILL, JOURNAL, DELIVERY CHALLAN, LORRY RECEIPT, OCTROI PAYMENT RECEIPT, CONFIRMATION FROM TRANSPORT OPERATOR, ETC. TO SUBSTANTIATE HER CLAIM OF PURCHASE FROM THE AFORE - SAID PARTY. THE ASSESSING OFFI CER FURTHER DISCUSSED THE ISSUE AND CONCLUDED AS UNDER: 9. FROM THE ABOVE FACTS, IT CAN BE SEEN THAT THE ASSESSEE HAS FAILED TO BRING BEFORE THE UNDERSIGNED CLINCHING EVIDENCE TO ESTABLISH THE RECEIPT OF GOODS FROM THE AFORESAID PARTIES. AS A RESULT, THE ASSESSEE'S CLAIM OF PURCHASES FROM AFORESAID PARTIES CANNOT BE SAID TO BE GENUINE IN NATURE. 10. FURTHER TO ABOVE, ON THE BASIS OF THE FOLLOWING REASONS ALSO, THE ASSESSEE'S CLAIM OF PURCHASES FROM THE AFORESAID PARTIES IS FOUND TO BE NON - GENUINE / BOGUS IN NATURE: ( I ) THE DEDUCTION OF VAT, IF ANY, IN THE BILL WILL NOT BOLSTER THE CASE OF THE ASSESSEE. IT IS BECAUSE OF THE FACT THAT SUCH DEDUCTION DOES NOT PROVE GENUINENESS OF A PARTICULAR TRANSACTION IN TERMS OF SUPPLY OF MATERIAL. SUCH DEDUCTION I S BASICALLY LINKED WITH THE PAYMENT ASPECT ONLY AND CANNOT ESTABLISH THE PURPOSE FOR WHICH PAYMENT IS MADE. (II) THE ONUS WAS UPON THE ASSESSEE TO PROVE THE GENUINENESS OF THE EXPENDITURE CLAIMED, WHICH HE HAS FAILED TO DISCHARGE. (III) IT IS WELL - SETTLED LAW THAT STRICT RULES OF EVIDENCE DO NOT APPLY TO INCOME TAX ACT AND THE REAL TEST WITH REGARD TO GENUINENESS OF THE TRANSACTION IS 'PREPONDERANCE OF PROBABILITIES' AND NOT 'BEYOND REASONABLE DOUBT'. RELIANCE IS PLACED ON THE DECISION IN THE CASE OF C. VASANTLAL & CO. VS. GT (1962) 45 ITR 206 (SC), CHATURBHUJ PANAUJ AIR 1969 (SC) AND SUMATI DAYAI VS. CIT (1995) 214 ITR 801 (SC). ONE HAS TO CONSIDER THE TOTALITY OF FACTS, SURROUNDING CIRCUMSTANCES AND HUMAN PROBABILITY FOR ARRIVING AT A CONCLUSION A S HELD IN THE CASE OF CIT VS. DURGA PRASAD 82 ITR 540 (SC) AND IN THE CASE OF SUMATI DAYAL VS. CTT (1995) 214 ITR 801 (SC). (IV) T HE PURCHASES FROM HAWALA OPERATORS FALL WITHIN THE AMBIT OF THE TERM 'COLOURABLE D EVICE' AND THE HON'BLE SUPREME COURT IN THE CASE OF MCDOWELL AND CO, LTD, VS. CTO 154 ITR 148 HAS OBSERVED THAT 'TAX PLANNING MAY BE LEGITIMATE PROVIDED IT IS WITHIN THE FRAMEWORK OF LOW. COLOURABLE DEVICES CANNOT BE PART OF TAX PLANNING AND IT IS WRONG TO ENCOURAGE OR ENTERTAIN THE BELIEF THAT IT I S HONOURABLE TO AVOID THE PAYMENT OF T AX BY RESORTING TO DUBIOUS METHOD. IT IS OBLIGATION OF EVERY CITIZEN TO PAY THE TAXES HONESTLY WITHOUT RESORTING TO SUBTERFUGES . 5 ITA NO. 3740/MUM/2017 (A.Y. 2010 - 11) SHRI MUFFAZAL HAKIM PENAWALA VS. CIT(A) (V) THE SALES TAX DEPARTMENT MADE A FINDING AND UPLOADED ON ITS WEBSITE THE NAMES OF ENTITIES WHICH ARE INVOLVED IN GIVING BOGUS BILLS ONLY AFTER CARRYING OUT A DETAIL ED ENQUIRY & INVESTIGATION. THE SALES TAX DEPARTMENT, BEING A STATUTORY AUTHORITY, HAS FOUND THAT THE AFORESAID PARTY ARE HAWALA OPERATORS. (VI) I T WAS INCUMBENT ON THE ASSESSEE TO PROVE THAT THE SUPPLIERS WERE GENUINE SUPPLIERS AND THEY REALLY SUPPLIED MATERIAL TO THE ASSESSEE AND THE ASSESSEE REALLY MADE PAYMENTS BY ACCOUNT PAYEE CHEQUES, TO THESE VERY PARTIES AND NONE ELSE. SUCH A BURDEN HAD TO BE DISCHARGED BY TH E ASSESSEE WITH VERY CLINCHING EVIDENCE. NO SERIOUS EFFORT HAS BEEN MADE BY THE ASSESSEE TO DISCHARGE SUCH BURDEN OF PROVING THE , GENUINENESS OF TRANSACTIONS WITH AFORESAID PARTIES. (VII) THE ASSESSEE HAS FAILED TO PRODUCE ANY OF THE AFORESAID PARTY FROM WHOM ALLEGED PURCHASES ARE CLAIMED TO BE MADE, BROKERS OR TRANSPORTERS BEFORE THE UNDERSIGNED FOR VERIFICATION. 11. SINCE THE AFORESAID PURCHASES ARE PROVED TO BE NON - GENUINE / BOGUS, THE ASSESSEE'S CLAIM OF RESPECTIVE SALES WITHOUT ANY DOUBT IS FRO M THE PURCHASES MADE AT LOWER RATES FROM GREY MARKET AND THE ASSESSEE HAS BEEN ABLE TO INFLATE THE PURCHASES DEBITED IN THE PROFIT & LOSS ACCOUNT. THUS, THE INESCAPABLE CONCLUSION ONE CAN DRAW IS THAT THE ASSESSEE HAS INFLATED THE EXPENDITURE OF PURCHASES TO REDUCE ITS TAXABLE INCOME UNDER THE GARB OF AFORESAID BOGUS PURCHASES. 12. THE HON'BLE ITAT, MUMBAI IN THE CASE OF ACIT VS. ARYA TEXTURISERS AND TWISTERS (ITA N0.29/MUM/02) DATED 03/12/2005 HAS UPHELD THE GP ADDITION. FURTHER, THE HON'BLE ITAT, MUMBAI IN THE CASE OF SHRI MADHUKANT B. GANDHI VS. ITO IN ITA NO. 1950/MUM/2009 DATED 23/02/2010 AFTER CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE, RESTRICTED THE ADDITION TO A CERTAIN PER - CENT - AGE OF DISPUTED PURCHASES. FURTHER, THE HON'BLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. BHOLANATH PLY FAB PVT. LTD. (2013) [(355 ITR 290/40 TAXMANN.COM 494 (2014) /220 TAXMANN 82) (MAG.)( GUJ.)(HC)] HAS CONFIRMED THE DECISION OF THE ITAT THAT THE ADDITION SHOULD BE RESTRICTED TO PROFIT ELEMENT/BENEFIT ACCRUED TO TH E ASSESSEE BECAUSE OF BOGUS PURCHASES. FURTHERMORE, THE HON'BLE GUJARAT HIGH COURT IN CASE OF SIMIT P. SHETH, HAS OBSERVED THAT IN THE CASE OF THE BOGUS PURCHASES, FAIR RATE OF PROFIT TO BE ESTIMATED AND BE ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. 6 ITA NO. 3740/MUM/2017 (A.Y. 2010 - 11) SHRI MUFFAZAL HAKIM PENAWALA VS. CIT(A) 13. CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE, GP @ 12.5% OF ALLEGED PURCHASE NSIDERED AS SUPPRESSED PROFITS FOR THE YEAR UNDER CONSIDERATION IN RESPECT OF THE ABOVE UINE / BOGUS PURCHASES CLAIMED BY THE ASSESSEE. 14 . CONSEQUENTLY, ELEMENT OF SUPPRESSED PROFIT ON ACCOUNT OF BOGUS PURCHASES FROM THE AFORESAID HAWALA/SUSPICIOUS PARTIES FOR THE YEAR UNDER CONSIDERATION IS WORKED OUT AS FOLLOWS : PARTICULARS AMOUNT TOTAL QUANTUM OF BOGUS PURCHASES = RS.3,30,56,263/ - ELEMENT OF SUPPRESSED PRO FIT ON ACCOUNT I OF BOGUS PURCHASES = RS.41,32,032/ - (12.5%OFRS.3,30,56,263/ - ) 15. THUS, ELEMENT OF SUPPRESSED PROFIT OF AS WORKED OUT ABOVE, ON ACCOUNT OF BOGUS/UNPROVED PURCHASES MADE BY THE ASSESSEE FROM THE ABOVE MENTIONED HAWALA / UNPROVED PARTI ES FOR THE YEAR UNDER CONSIDERATION, IS ACCORDINGLY ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. 5. UPON THE ASSESSEES APPEAL, THE LD. CIT(A) NOTED THAT IN THE ASSESSMENT YEAR 2009 - 10, IN ASSESSEES OWN CASE, HE HAD SUSTAINED PART OF THE ADDITION. HE FURTHER NOTED THAT THE GP RESULTS THIS YEAR SHOW PROFIT PERCENTAGE OF 9%. HE WAS OF THE OPINION THAT IT WAS FAIR AND REASONABLE TO SUSTAIN RATE OF 6% ON UNVERIFIED COMPONENT OF PURCHASES. 6. AGAINST THE ABOVE, THE ASSESSEE IS IN APPEAL BEFORE US. 7. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATERIAL ON RECORD. THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT THERE HAS BEEN VAT DEMAND IN THIS CASE, AND THE ASSESSEE HAS FULLY PAID THE VAT DEMAND. SHE FURTHER SUBMITTED THAT THE TRANSACTIONS ARE GENUINE. TH AT TH E ASSESSING OFFICER HAS NOT ISSUED ANY NOTICE TO THE CONCERNED PARTIES. SHE FURTHER PLACED RELIANCE UPON SOME CASE LAW FROM THE ITAT AND THE 7 ITA NO. 3740/MUM/2017 (A.Y. 2010 - 11) SHRI MUFFAZAL HAKIM PENAWALA VS. CIT(A) HON'BLE BOMBAY HIGH COURT DECISION IN THE CASE OF NIKUNJ EXIMP ENTERPRISES PRIVATE LIMITED (372 ITR 619) . IT WAS FURTHER SUBMITTED THAT FOR A.Y. 2009 - 10, THE LD. CIT(A) HAS CONSIDERED THE PROFIT ELEMENT @ 4%, HOWEVER FOR ASSESSMENT YEAR 2010 - 11, THE SAME LD. CIT(A) HAS CONFIRMED THE PROFIT ELEMENT @ 6%. ACCORDINGLY, THE LD. COUNSEL OF THE ASSESSEE PLEADED THAT NO AD DITION SHOULD BE MADE. 8. PER CONTRA, THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THERE IS NO DOUBT THAT THE SUPPLIERS ARE BOGUS IN THIS CASE. HE SUBMITTED THAT THE ASSESSEE HAS NOT PROVIDED ANY EVIDENCE OF MO VE MENT OF GOODS FOR PURCHASE. HE FURTHE R PLACED RELIANCE UPON THE DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF N K INDUSTRIES VS DY CIT IN INCOME TAX APPEAL NO. 240 OF 2003 , VIDE ORDER DATED 20.06.2016, WHEREIN HUNDRED PERCENT OF THE BOGUS PURCHASES WAS HELD TO BE ADDED IN THE HANDS OF THE ASSESSEE AND TRIBUNALS RESTRICTION OF THE ADDITION TO 25% OF THE BOGUS PURCHASES WAS SET ASIDE. IT WAS EXPOUNDED THAT WHEN PURCHASE BILLS HAVE BEEN FOUND TO BE BOGUS 100% DISALLOWANCE WAS REQUIRED. THE SPECIAL LEAVE PETITION AGAINST THIS ORDER ALONG W ITH OTHERS HAS BEEN DISMISSED BY THE HONBLE APEX COURT VIDE ORDER DATED 16.1.2017. 9. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. 10. WE FIND THAT CREDIBLE AND COGENT INFORMATION WAS RECEIVED IN THIS CASE BY THE ASSESSING OFFICER THAT CERTAIN ACCOMMODATION ENTRY PROVIDER/BOGUS SUPPLIERS WERE BEING USED BY CERTAIN PARTIES TO OBTAINED BOGUS BILLS. ASSESSEE WAS FOUND TO HAVE 8 ITA NO. 3740/MUM/2017 (A.Y. 2010 - 11) SHRI MUFFAZAL HAKIM PENAWALA VS. CIT(A) TAKEN ACCOMMODATION ENTRY/BOGUS PURCHASE BILLS DURING THE CONCERNED ASSESSMENT YEAR FROM DIFFERENT PARTIES. BASED UPON THIS INFORMATION ASSESSMENT WAS REOPENED. THE CREDIBILITY OF INFORMATION RELATING TO REOPENING REMAINS UN - ASSAILED. IN SUCH FACTUAL SCENARIO THE ASSESSING OFFICER HAS MADE THE NECESSARY ENQUIRY. ASSESSEE HAS NOT BEEN ABLE TO PROVIDE ANY CONFIRMATION FROM ANY O F THE PARTY. ASSESSEE HAS ALSO NOT BEEN ABLE TO PRODUCE ANY OF THE PARTIES. NECESSARY EVIDENCE RELATING TO TRANSPORTATION OF THE GOODS WAS ALSO NOT ON RECORD. IN THIS FACTUAL SCENARIO IT IS AMPLY CLEAR THAT ASSESSEE HAS OBTAINED BOGUS PURCHASE BILLS. MERE PREPARATION OF DOCUMENTS FOR PURCHASES CANNOT CONTROVERT OVERWHELMING EVIDENCE THAT THE PROVIDERS OF THESE BILLS ARE BOGUS AND NON - EXISTENT. 11. IN SUCH CIRCUMSTANCE , THERE IS NO DOUBT THAT THESE PARTIES ARE NON - EXISTENT. I FIND IT FURTHER STRANGE THAT A SSESSEE WANTS THE REVENUE TO PRODUCE ASSESSEES OWN VENDORS, W HOM THE ASSESSEE COULD NOT PRODUCE. TH AT EVEN PURCHASE BILLS HAVE NOT BEEN PRODUCED. TH E PURCHASE BILLS FROM THESE NON - EXISTENT THE/BOGUS PARTIES CANNOT BE TAKEN AS COGENT EVIDENCE OF PURCHASES. IN LIGHT OF THE OVERWHELMING EVIDENCE THE REVENUE AUTHORITIES CANNOT PUT UPON BLINKERS AND ACCEPT THESE PURCHASES AS GENUINE. THIS PROPOSITION IS DULY SUPPORTED BY HONBLE APEX COURT DECISION IN THE CASE OF SUMATI DAYAL 214 ITR 801 AND DURGA PRASAD M ORE 82 ITR 540. IN THE PRESENT CASE , THE ASSESSEE WANTS THAT THE UNASSAILABLE FACT THAT THE SUPPLIERS ARE NON EXISTENT AND THUS BOGUS SHOULD BE IGNORED AND ONLY THE DOCUMENTS BEING PRODUCED SHOULD BE 9 ITA NO. 3740/MUM/2017 (A.Y. 2010 - 11) SHRI MUFFAZAL HAKIM PENAWALA VS. CIT(A) CONSIDERED. THIS PROPOSITION IS TOTALLY UNSUSTAINABLE IN LIG HT OF ABOVE APEX COURT DECISIONS. 12. WE FURTHER FIND THAT HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF NIKUNJ EXIMP E NTERPRISES (IN WRIT PETITION NO 2860, ORDER DT 18.6.2014) HAS UPHELD HUNDRED PERCENT ALLOWANCE FOR THE PURCHASES SAID TO BE BOGUS WHE N THE SALES HAVE NOT BEEN DOUBTED. HOWEVER THE FACTS OF THAT CASE WERE DIFFERENT. FURTHERMORE THE SALES IN THAT CASE WERE BASICALLY TO GOVERNMENT DEPARTMENTS. HENCE THE RATIO FROM THIS DECISION IS NOT APPLICABLE ON THE FACTS OF THE CASE. 13. IN THESE CIR CUMSTANCES , THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS REFERRED TO HONBLE G UJARAT HIGH COURT DECISION IN THE CASE OF TAX APPEAL NO 240 OF 2003 IN THE CASE OF N K INDUSTRIES VS DY CIT, ORDER DT 20/06.2016, WHEREIN HUNDRED PERCENT OF THE BOGUS PURCHASES WAS HELD TO BE ADDED IN THE HANDS OF THE ASSESSEE AND TRIBUNALS RESTRICTION OF THE ADDITION TO 25% OF THE BOGUS PURCHASES WAS SET ASIDE. IT WAS EXPOUNDED THAT WHEN PURCHASE BILLS HAVE BEEN FOUND TO BE BOGUS 100% DISALLOWANCE WAS REQUIRED. THE SPECIAL LEAV E PETITION AGAINST THIS ORDER ALONG WITH OTHERS HAS BEEN DISMISSED BY THE HONBLE APEX COURT VIDE ORDER DT 16 .1 2017. 14. WE FURTHER NOTE THAT HONBLE RAJASTHAN HIGH COURT HAS SIMILARLY TAKEN NOTE OF DECISIONS OF THE APEX COURT ON THE ISSUE OF BOGUS PURC HASES IN THE CASE OF CIT JAIPUR VS SHRUTI GEMS IN ITA NO. 658 OF 2009. THE HONBLE HIGH COURT HAS REFERRED TO THE 10 ITA NO. 3740/MUM/2017 (A.Y. 2010 - 11) SHRI MUFFAZAL HAKIM PENAWALA VS. CIT(A) DECISION OF CIT JAIPUR VS. ADITYA GEMS, D. B. IN ITA NO. 234 OF 2008 DATED 02.11.2016, WHEREIN THE HONBLE COURT HAD INTER ALIA HELD AS UNDER : 'CONSIDERING THE LAW DECLARED BY THE SUPREME COURT IN THE CASE OF VIJAY PROTEINS LTD. VS. COMMISSIONER OF INCOME TAX, SPECIAL LEAVE TO APPEAL (C) NO.8956/2015 DECIDED ON 06.04.2015 WHEREBY THE SUPREME COURT HAS DISMISSED THE SLP CONFIRMED THE ORDER DATE D 09.12.2014 PASSED BY THE GUJARAT HIGH COURT AND OTHER DECISIONS OF THE HIGH COURT OF GUJARAT IN THE CASE OF SANJAY OILCAKE INDUSTRIES VS. COMMISSIONER OF INCOME TAX (2009) 316 ITR 274 (GUJ) AND N.K. INDUSTRIES LTD. VS. DY. C.I.T., TAX APPEAL NO.240/2003 DECIDED ON 20.06.2016, THE PARTIES ARE BOUND BY THE PRINCIPLE OF LAW PRONOUNCED IN THE AFORESAID THREE JUDGMENTS. 15. IN LIGHT OF THE ABOVE HIGH COURT AND HONBLE APEX COURT DECISION, THE DECISIONS OF TRIBUNAL REFERRED BY THE LD. LD. COUNSEL OF THE ASSE SSEE ARE NOT BEING DEALT WITH. 16. ALTHOUGH THE FACTS OF THE CASE AND THE CASE LAWS DISCUSSED ABOVE DO NOT WARRANT ANY INTERFERENCE WITH THE ASSESSING OFFICERS ORDER, WE NOTE THA T THIS IS NOT AN APPEAL BY THE R EVENUE. HENCE IT WILL NOT BE APPROPRIATE TO TAKE AWAY THE RELIEF ALREADY GRANTED BY THE LD. CIT(A) TO THE ASSESSEE. HENCE WE CONFIRM THE ORDER OF LD. CIT(A). 11. IN THE RESULT , THIS APPEAL FILED BY THE ASSESSEE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 08.11.2017 SD/ - SD/ - ( SANDEEP GOSAIN ) (S HAMIM YAHYA ) / J UDICIAL MEMBER / A CCOUNTANT MEMBER MUMBAI ; DATED : 08.11.2017 . . ./ ROSHANI , SR. PS 11 ITA NO. 3740/MUM/2017 (A.Y. 2010 - 11) SHRI MUFFAZAL HAKIM PENAWALA VS. CIT(A) / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F ILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI