KIRTI MURLIDHAR MUNI, MUMBAI V. ITO 19(2)(2), MUMBAI

ITA 6329/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8594 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-11-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 26-10-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAM TIWARI
• Keywords: Reopening of assessment; Bogus purchase; Tangible material; Accommodation entries; Reason to believe
• Section: 143(3); 133(6); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA, A M AND SHRI SANDEEP GOSAIN, JM ./ I.T.A. NO. 6329/MUM/2016 ( / ASSESSMENT YEAR: 2010 - 11 ) SHRI KIRTI MU RLIDHAR MUNI 402, SHUBHAM BUILDING, RAJAWADI NO.1, BEHIND BANK OF BARODA, GHATKOPAR (E), MUMBAI - 400 077 / VS. ITO - 19(2)(2), MUMBAI ./ ./ PAN/GIR NO. AAAPM 9268 Q ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : NONE / RESPONDENT BY : SHRI RAM TIWARI / DATE OF HEARING : 14.09.2017 / DATE OF PRONOUNCEMENT : 07.11 .2017 / O R D E R PER SHAMIM YAHYA , A. M.: THIS A PPEAL BY THE ASSESSE E DIRECTED AGAINST THE ORDER BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 30 , MUMBAI (CIT(A) FOR SHORT) DATED 19.08.2016 AND PERTAINS TO THE ASSESSMENT YEAR (A.Y.) 200 9 - 1 0 . 2. IN THE GROUNDS OF APPEAL, THE ASSESSEE HAS CHALLENGED THE VALIDITY OF REOPENIN G AND MERIT S OF ADDITION OF RS.20,84,039/ - , ON ACCOUNT OF BOGUS PURCHASE. 2 ITA NO. 6329/MUM/2016 (A.Y. 2010 - 11) SHRI KIRTI MURLIDHAR MUNI VS. ITO 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL ENGAGED IN THE BUSINESS AS 'SUPPLIERS OF IRON, STEEL AND GENERAL MERCHANTS' OPERATING UNDER THE TRADE NAME M/S HEMAI ENTERPRISES. THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2009 - 10 ON 13 - 08 - 2009, DECLARING TOTAL INCOME OF RS. 3,74,860/ - . THE RETURN WAS PROCESSED U/S 143(1) OF THE IT ACT 1961. SUBSEQUENTLY, ON THE BASIS OF INFORMATION FORWARDED BY THE DGTT (INV.), WHO IN TURN RECEIVED THE SAME FROM THE SALES TAX DEPARTMENT WITH REGARD TO THE SUSPICIOUS DEALERS PROVIDING ACCOMMODATION ENTRIES WITHOUT ACTUALLY DELIVERING A N Y GOODS AND SERVICES, AND THE ASSESSEE IS ONE OF SUCH BENEFICIARY, THE ASSESSMENT WAS REOPENED BY ISSUING NOTICE U/S 148 OF THE ACT AFTER RECORDING THE REASONS ON 05 - 02 - 2014. THE REOPENED ASSESSMENT U/S 143(3) R.W.S 147 OF THE ACT WAS COMPLETED BY THE ASSESSING OFFICER ON 11 - 03 - 2015, DETERMINING THE TOTAL INCOME AT RS. 24,58,900/ - . 4. DURING THE COURSE OF REOPENED ASSESSMENT PROCEEDINGS, TO ASCERTAIN THE GENUINENESS OF PURCHASES SHOWN IN THE ACCOUNTS, NOTICES U/S 133(6) WERE SENT TO THE CONCERNED PARTIES. NOTICE WAS RETURNED UNDELIVERED BY THE POSTAL AUTHORITIES WITH A REMARK NOT FOUND. THE ASSESSEE WAS CONFRONTED WITH THE SAME AND WAS ASKED TO PRODUCE THE SAID HAWALA DEALERS FOR CROSS EXAMINATION. THE ASSESSEE FAILED TO DO SO AND ALSO COULD NOT FILE THE VITAL DOCUMENTS SUCH AS DELIVERY CHALLANS, TRANSPORT RECEIPTS, OCTROI RECEIPTS, GOOD S INWARD REGISTER MAINTAINED AT GODOWN. ASSESSE COULD NOT EST ABLISH GENUINENESS OF PURCHASES MADE. THE ASSESSING OFFICER RELYING ON THE 3 ITA NO. 6329/MUM/2016 (A.Y. 2010 - 11) SHRI KIRTI MURLIDHAR MUNI VS. ITO DECISION OF GUJARAT HIGH COURT IN THE CASE OF CIT VS SIMIT P. SHETH REPORTED IN 356 ITR 451 (GUJ.) CONCLUDED THAT A L L TH E PARTIES FROM WHOM PURCHASES MADE WERE NON GENUINE TRANSACTIONS TO SUPPRESS THE PROFITS AND TO REDUCE THE TAX LIABILITY. IN VIEW OF THE SAME, ESTIMATED THE PROFIT ELEMENT EMBEDDED @ 12.5% ON THE TOTAL PURCHASES OF RS. 1,66,72,3127 - FROM TEN PARTIES, WHICH WORKS OUT TO RS. 20,84,039/ - AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE , AS PROFIT EARNED FROM SUCH PURCHASE . 5. UPON THE ASSESSEES APPEAL, THE LD. CIT(A) AFFIRMED THE REOPENING BY HOLDING AS UNDER: 7.1 THE MAIN CONTENTION OF THE APPELLANT IS THAT THE ASSESSMENT WAS RE OPENED ON THE BASIS OF GENERAL CONFESSION BY A PERSON THAT HE HAS INDULGED ONLY IN BOGUS TRANSACTIONS. FROM THE REASONS RECORDED, IT IS CLEAR THAT THE ASSESSMENT WAS REOPENED ON THE BASIS OF THE INFORMATION RECEIVED FROM THE DGIT(INV.), MUMBAI ABOUT PARTIES CONFESSED BEFORE THE SALES TAX AUTHORITIES THAT THEY HAVE ACTUALLY NOT SOLD ANY MATERIAL BUT ISSUED BOGUS BILLS. THE SUSPICIOUS DEALER IS A PERSON WHO IS SUSPECTED FOR ISSUING FAKE BILLS WITHOUT SELLING THE GOODS. IT IS. SUBMITTED THAT THE LAW ON REASSESSMENT IS CLEAR TO THE EFFECT THAT AN ASSESSMENT CAN BE OPENED ONLY IF THE ASSESSING OFFICER HAS REASONS, TO BELIEVE THAT INCOME OF THE ASSESSEE HAS ESCAPED ASSESSMENT. AS ON THE DATE OF RECORDING REASONS, NEW MATERIAL HAD COME ON RECORD, NEW INFORMATION HAD BEEN RECEIVED BY THE AO TO TRIGGER THE REOPENING OF ASSESSMENT. IN THESE CIRCUMSTANCES, THE CONDITION PRECEDENT FOR A VALID EXERCISE OF THE POWER TO REOPEN THE ASSESSMENT, IS VERY MUCH PRESENT IN THIS CASE. THE CONDITIONS WHICH ARE PRE SCRIBED BY THE STATUTE FOR THE EXERCISE OF REOPENING ARE FULFILLED IN THE PRESENT CASE. 7.2 IT IS SEALED LEGAL POSITION THAT IN A CASE WHERE THERE WAS NO ASSESSMENT OR RE - ASSESSMENT PRIOR TO REOPENING OF ASSESSMENT, EVEN IF ALL THE MATERIAL FACTS ARE DIS CLOSED IN THE RETURN OF INCOME ALREADY FILED, REOPENING CAN BE INITIATED, IF THE ASSESSING OFFICER HAS 'REASON TO BELIEVE' THAT THE INCOME HAS ESCAPED ASSESSMENT. THE ASSESSEE IN SUCH CASES CANNOT ASSAIL THE REOPENING ON THE GROUND THAT THE FACTS WERE ALRE ADY PLACED ON RECORD AND THAT THE ASSESSING OFFICER OUGHT TO HAVE CONSIDERED THE FACTS. HON'BLE SUPREME COURT IN THE CASE OF AC IT V S. RAJESH JHAVERI STOCK BROKERS (P) LTD. (291 UR 500) OBSERVED THAT 4 ITA NO. 6329/MUM/2016 (A.Y. 2010 - 11) SHRI KIRTI MURLIDHAR MUNI VS. ITO THE WORD 'REASON' IN THE EXPRESSION R EASON TO BELIEVE W OULD MEAN CAUSE OR JUSTIFICATION AND IF THE ASSESSING OFFICER HAS CAUSE OR JUSTIFICATION TO KNOW OR SUPPOSE THAT INCOME HAD ESCAPED ASSESSMENT, IT CAN BE SAID TO HAVE REASONS TO BELIEVE THAT INCOME HAD ESCAPED ASSESSMENT. IT IS FURTHER OBSERVED BY THE SUPR EME COURT THAT THE EXPRESSION CANNOT BE READ TO MEAN THAT THE ASSESSING SHOULD HAVE FINALLY ASCERTAINED THE FACT BY LEGAL EVIDENCE OR CONCLUSION. AT THE INITIATION STAGE, WHAT IS REQUIRED IS 'REASON TO BELIEVE', BUT NOT THE ESTABLISHED OF ESCAPEMENT OF INC OME. AT THE STAGE OF ISSUE OF NOTICE, THE ONLY QUESTION IS WHETHER THERE WAS RELEVANT MATERIAL ON WHICH A REASONABLE PERSON COULD HAVE FORMED A REQUISITE BELIEF THAT INCOME HAS ESCAPED ASSESSMENT IN THE PRESENT CASE, IT IS EVIDENT FROM THE REASONS RECORDED AS REPRODUCED IN THE STATEMENT OF FACTS BY THE APPELLANT THAT THE AO HAS RECEIVED SPECIFIC AND CREDIBLE INFORMATION FROM THE DGIT(INV.), MUMBAI THAT THE ASSESSEE WAS INVOLVED IN MAKING BOGUS PURCHASES THROUGH HAWALA DEALERS TO THE EXTENT OF RS.1 ,66,72,312 / - . THE INFORMATION PRIMA FACIE REVEALED THAT THE APPELLANT HAS CLAIMED PURCHASES FOR THE A.Y. 2009 - 10 IN THEIR BOOKS. BASED ON THIS PRECISE INFORMATION, THE AO ISSUED NOTICE U/S. 148 OF THE IT. ACT AS HE HAD PRIMA - FACIE REASONS TO BELIEVE THAT INCOME CHAN GEABLE TO TAX HAD ESCAPED ASSESSMENT WITHIN THE MEANING OF SEC. 147 OF THE IT. ACT. THUS, THERE WAS CAUSE OR JUSTIFICATION FOR THE AO TO INVOKE PROVISIONS OF SEC. 147 AND ISSUE NOTICE U/S. 148. AS A L READY MENTIONED, AT THE INITIATION STAGE, WHAT IS REQUIRE D TO BE SEEN IS WHETHER THERE ARE PRIMA - FACIE 'REASONS TO BELIEVE' BUT NOT THE ESTABLISHED FACT OF ESCAPEMENT OF INCOME. THE AO ALSO RECORDED PROPER REASONS FOR FORMATION OF THE BELIEF THAT INCOME HAS ESCAPED ASSESSMENT. IT IS ALSO IMPORTANT TO NOTE THAT T HE INFORMATION RELATING TO HAWALA OPERATORS WAS ALSO MADE AVAILABLE IN PUBLIC DOMAIN I.E. IN THE OFFICIAL WEBSITE OF THE MAHARASHTRA SALES TAX DEPARTMENT AND THEREFORE THE REASONS FOR REOPENING THE ASSESSMENT ARE NOT BASED ON MERE SUSPICION. THUS, ALL THE CONDITIONS NECESSARY FOR REOPENING OF THE ASSESSMENT UNDER THE PROVISIONS OF SEC. 147 AND FOR ISSUE OF NOTICE U/S. 148 ARE SATISFIED IN THE CASE OF THE APPELLANT FOR THE YEAR UNDER APPEAL. FOR THE FOREGOING REASONS, I T IS HELD THAT REOPENING OF THE , ASSESS MENT UNDER SECTION 147 OF THE ACT WAS DONE PROPERLY FOLLOWING THE DUE PROCEDURES LAID DOWN BY THE LAW AND THERE IS NO INFIRMITY OR ILLEGALITY IN REOPENING THE ASSESSMENT AND THE NOTICE ISSUED U/S. 148 FOR THE YEAR UNDER CONSIDERATION IS PERFECTLY LEGAL AND VALID. RESULTANTLY, PART OF THE GROUND RELATING TO THE REOPENING IS 'DISMISSED' . 6. ON MERITS OF THE CASE, THE LD. CIT(A) REFERRED TO THE DECISION OF SUMIT P. SETH FOLLOWED BY THE ASSESSING OFFICER BUT PROCEEDED TO GRANT FURTHER RELIEF. HE REDUCED 5 ITA NO. 6329/MUM/2016 (A.Y. 2010 - 11) SHRI KIRTI MURLIDHAR MUNI VS. ITO THE AD DITION TO THE RATE OF 6.5% OF BOGUS PURCHASE RESULTING THE CONFIRMATION OF ADDITION OF RS.10,83,700/ - . 7. AGAINST THE ABOVE ORDER, THE ASSESSEE IS IN APPEAL BEFORE US. 8. WE HAVE HEARD LD. DEPARTMENTAL REPRESENTATIVE. NONE APPEARED ON BEHALF OF THE ASSES SEE DESPITE NOTICE. AS REGARDS THE REOPENING OF THE CASE , ON A CAREFUL CONSIDERATION, WE NOTE THAT IN THIS CASE INFORMATION WAS RECEIVED BY THE ASSESSING OFFICER FROM DGIT INVESTIGATION (MUMBAI) THERE ARE SOME PARTIES WHO ARE ENGAGED IN THE HAWALA TRANSACT IONS AND ARE ALSO INVOLVED IN ISSUING BOGUS PURCHASE BILLS FOR SALE OF MATERIAL WITHOUT DELIVERY OF GOODS, WHICH INFORMATION WAS BASED ON INFORMATION RECEIVED BY REVENUE FROM MAHARASHTRA SALES TAX AUTHORITY. INFORMATION WAS RECEIVED THAT THE ASSESSEE WAS B ENEFICIARY OF HAWALA ACCOMMODATION ENTRIES FROM ENTRY PROVIDERS BY WAY OF BOGUS PURCHASE. THE ACCOMMODATION ENTRY PROVIDER HAS DEPOSED AND ADMITTED BEFORE THE MAHARASHTRA SALES TAX AUTHORITY VIDE STATEMENT/ AFFIDAVIT THAT THEY WERE ENGAGED IN PROVIDING BOG US ACCOMMODATION ENTRIES WHEREIN BOGUS SALE BILLS WERE ISSUED WITHOUT DELIVERY OF GOODS, IN CONSIDERATION FOR COMMISSION. THESE, ACCOMMODATION ENTRY PROVIDERS, ON RECEIPT OF CHEQUES FROM PARTIES AGAINST BOGUS BILLS FOR SALE OF MATERIAL, LATER ON WITHDREW C ASH FROM THEIR BANK ACCOUNTS, WHICH WAS RETURNED TO BENEFICIARIES OF BOGUS BILLS AFTER DEDUCTION OF THEIR AGREED COMMISSION. THE ASSESSEE WAS STATED TO BE ONE OF THE BENEFICIARIES OF THESE BOGUS ENTRIES OF SALE OF MATERIAL FROM HAWALA ENTRY OPERATORS IN FA VOUR OF THE ASSESSEE 6 ITA NO. 6329/MUM/2016 (A.Y. 2010 - 11) SHRI KIRTI MURLIDHAR MUNI VS. ITO WHEREIN THE ASSESSEE MADE ALLEGED BOGUS PURCHASES THROUGH THESE BOGUS BILLS ISSUED BY HAWALA ENTRY PROVIDERS IN FAVOUR OF THE ASSESSEE. THESE DEALERS WERE SURVEYED BY THE SALES TAX INVESTIGATION DEPARTMENT WHEREBY THE DIRECTORS OF THES E DEALERS HAVE ADMITTED IN A DEPOSITION VIDE STATEMENTS/AFFIDAVIT MADE BEFORE THE SALES TAX DEPARTMENT THAT THEY WERE INVOLVED IN. ISSUING BOGUS PURCHASE BILLS WITHOUT DELIVERY OF ANY MATERIAL. THERE IS A LIST OF SUCH PARTIES WHEREIN THE ASSESSEE IS STA TED TO BE BENEFICIARY OF BOGUS PURCHASE BILLS. 9 . FROM THE ABOVE, WE FIND THAT TANGIBLE AND COGENT INCRIMINATING MATERIAL WERE RECEIVED BY THE AO WHICH CLEARLY SHOWED THAT THE ASSESSEE WAS BENEFICIARY OF BOGUS PURCHASE ENTRIES FROM BOGUS ENTRY PROVIDERS WHICH FORMED THE REASON TO BELIEVE BY THE AO THAT INCOME HAS ESCAPED ASSESSMENT. THE INFORMATION SO RECEIVED BY THE AO HAS LIVE LINK WITH REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT. ON THESE INCRIMINATING TANGIBLE MATERIAL INFORMATION, ASSESSMENT WAS REOPENED. AT THIS STAGE THERE HAS TO BE PRIMA FACIE BELIEF BASED ON SOME TANGIBLE AND MATERIAL INFORMATION ABOUT ESCAPEMENT OF INCOME AND THE SAME IS NOT REQUIRED TO BE PROVED TO THE GUILT. IN THIS REGARD, WE REFER TO THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF CIT(A) VS. RAJESH JHAVERI STOCK BROKERS P. LTD . 291 ITR 500: - 'SECTION 147 AUTHORISES AND PERMITS THE ASSESSING OFFICER TO ASSESS OR REASSESS INCOME CHARGEABLE TO LAX IF HE HAS REASON TO BELIEVE THAT INCOME FOR ANY ASSESSMENT YEAR HAS ESCAPED ASSESSMENT. THE WORD 'REASON' IN THE PHRASE 'REASON TO BELIEVE' WOULD MEAN CAUSE OR JUSTIFICATION. IF THE AO HAS CAUSE OR JUSTIFICATION TO KNOW OR SUPPOSE (HAT INCOME HAD ESCAPED ASSESSMENT, IT CAN BE SAID TO HAVE REASON TO BELIEVE THAT AN INCOME H AD ESCAPED ASSESSMENT. THE 7 ITA NO. 6329/MUM/2016 (A.Y. 2010 - 11) SHRI KIRTI MURLIDHAR MUNI VS. ITO EXPRESSION CANNOT BE READ TO MEAN THAT THE AO SHOULD HAVE FINALLY ASCERTAINED THE FACT BY LEGAL STATUTE WITH SOLICITUDE FOR THE PUBLIC EXCHEQUER WITH AN INBUILT IDEA OF FAIRNESS TO TAXPAYERS. AS OBSERVED BY THE SUPREME COURT IN C ENTRAL PROVINCES MANAGNESE ORE CO, LTD. V. ITO(1991) 191 ITR 662, FOR INITIATION OF ACTION UNDER SECTION 147(A) (AS THE PROVISION STOOD AT THE RELEVANT TIME) FULFILLMENT OF THE TWO REQUISITE CONDITIONS IN THAT REGARD IS ESSENTIAL. AT THAT STAGE, THE FINAL OUTCOME OF THE PROCEEDING IS NOT RELEVANT. IN OTHER WORDS, AT THE INITIATION STAGE, WHAT IS REQUIRED IS 'REASON TO BELIEVE', BUT NOT THE ESTABLISHED FACT OF ESCAPEMENT OF INCOME. AT THE STAGE OF ISSUE OF NOTICE, THE ONLY QUESTION IS WHETHER THERE WAS RELEV ANT MATERIAL ON WHICH A REASONABLE PERSON COULD HAVE FORMED A REQUISITE BELIEF WHETHER THE MATERIALS WOULD CONCLUSIVELY PROVE THE ESCAPEMENT IS NOT THE CONCERN AT THAT STAGE. THIS IS SO BECAUSE THE FORMATION OF BELIEF BY THE AO IS WITHIN THE REALM OF SUBJE CTIVE SATISFACTION ITO V. SELECTED DALURBAND COAL CO, (P.) LTD. (1996) 217 ITR 597 (SUPREME COURT): RAYMOND WOOLLEN MILLS LTD. V. ITO (1999) 236 ITR 34 (SUPREME COURT). 1 0 . THE ABOVE DISCUSSION AND PRECEDENT FROM APEX COURT FULLY JUSTIFY THE VALIDITY OF REOPENING IN THIS CASE. FURTHER WE FIND THAT THE LD. CIT(A) HAS CAREFULLY EXAMINED THE ISSUE AND HAS PROPERLY APPRECIATED THE ISSUE. HENCE, WE DO NOT FIND ANY INFIRMITY IN THE SAME. ACCORDINGLY, WE UPHOLD THE ORDER OF THE LD. CIT(A) ON THE ISSUE OF REOPEN ING. SINCE, THE ISSUE HAS BEEN DECIDED ON THE BASIS OF THE HONBLE APEX COURT DECISION, THE OTHER CASE LAWS REFERRED BY ASSESSEE ARE NOT SUPPORTING THE ASSESSEES CASE. 11. AS REGARDS THE MERITS OF ADDITION, WE FIND THAT CREDIBLE AND COGENT INFORMATION W AS 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 TAKEN ACCOMMODATION ENTRY/BOGUS PURCHASE BILLS DURING THE CON CERNED ASSESSMENT YEAR FROM DIFFERENT PARTIES. BASED UPON THIS INFORMATION 8 ITA NO. 6329/MUM/2016 (A.Y. 2010 - 11) SHRI KIRTI MURLIDHAR MUNI VS. ITO 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. THE ASSESSING OFFICER HAS ISSUED NOTICES TO PARTIES W HICH HAS REMAINED UNRESPONDED. ASSESSEE HAS NOT BEEN ABLE TO PROVIDE ANY CONFIRMATION FROM ANY OF THE PARTY. ASSESSEE HAS ALSO NOT BEEN ABLE TO PRODUCE ANY OF THE PARTIES. NECESSARY EVIDENCE RELATING TO TR ANSPORTATION 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 BI LLS ARE BOGUS AND NON - EXISTENT. 12 . IN SUCH CIRCUMSTANCE , THERE IS NO DOUBT THAT THESE PARTIES ARE NON - EXISTENT. WE FIND IT FURTHER STRANGE THAT ASSESSEE WANTS THE REVENUE TO PRODUCE ASSESSEES OWN VENDORS, W HOM THE ASSESSEE COULD NOT PRODUCE. TH E PURCHA SE 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 SUPP ORTED 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 CONSIDERED. THIS PROPOSITION IS TOTALLY UNSUSTAINABLE IN LIGHT OF ABOVE APEX COURT DECISIONS. 9 ITA NO. 6329/MUM/2016 (A.Y. 2010 - 11) SHRI KIRTI MURLIDHAR MUNI VS. ITO 1 3 . WE FURTHER FIND THAT HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF NIKUNJ EXIMP E NTERPRISES (IN WRIT PETITION NO 286 0, ORDER DT 18.6.2014) HAS UPHELD HUNDRED PERCENT ALLOWANCE FOR THE PURCHASES SAID TO BE BOGUS WHEN 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. 1 4 . IN THESE CIRCUMSTANCES , 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 O F 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 THA T WHEN PURCHASE BILLS HAVE BEEN FOUND TO BE BOGUS 100% DISALLOWANCE WAS REQUIRED. THE SPECIAL LEAVE PETITION AGAINST THIS ORDER ALONG WITH OTHERS HAS BEEN DISMISSED BY THE HONBLE APEX COURT VIDE ORDER DT 16 .1 2017. 1 5 . WE FURTHER NOTE THAT HONBLE RAJAS THAN HIGH COURT HAS SIMILARLY TAKEN NOTE OF DECISIONS OF THE APEX COURT ON THE ISSUE OF BOGUS PURCHASES IN THE CASE OF CIT JAIPUR VS SHRUTI GEMS IN ITA NO. 658 OF 2009. THE HONBLE HIGH COURT HAS REFERRED TO THE 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: 10 ITA NO. 6329/MUM/2016 (A.Y. 2010 - 11) SHRI KIRTI MURLIDHAR MUNI VS. ITO '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.8956/2 015 DECIDED ON 06.04.2015 WHEREBY THE SUPREME COURT HAS DISMISSED THE SLP CONFIRMED THE ORDER DATED 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 IN COME 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. 1 6 . IN LIGHT OF THE ABOVE HIGH COURT AND HONBLE APEX COURT DECISION, THE DECISIONS OF TRIBUNAL REFERRED BY THE LD. LD. COUNSEL OF THE ASSESSEE ARE NOT BEING DEALT WITH. 1 7 . ALTHOUGH WE FIND THAT FACTS AND CIRCUMSTANCE AND THE CASE LAWS MENTIONED ABOVE DO NOT WARRANT ANY INTERFERENCE WITH THE ASS ESSING OFFICERS ORDER, HOWEVER, 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). 1 8 . IN THE RESULT , THIS APPEAL FILED BY THE ASSESSEE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 07.11.2017 SD/ - SD/ - ( SANDEEP GOSAIN ) (S HAMIM YAHYA ) / J UDICIAL MEMBER / A CCOUNTANT MEMBER MUMBAI ; DATED : 07.11.2017 . . ./ ROSHANI , SR. PS 11 ITA NO. 6329/MUM/2016 (A.Y. 2010 - 11) SHRI KIRTI MURLIDHAR MUNI VS. ITO / COPY OF THE ORDER FORWARDED TO : 1. / THE AP PELLANT 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