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TMI Blog2019 (2) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... e order dated 03.04.2018. 2. In these appeals by the assessee, the Tribunal has restricted the disallowance for bogus purchases from 25% done by the ld. CIT(A) to 12.5%. 3. The first submission of the ld. Counsel of the assessee is that the assessee has raised the following issues: a) Issuance of notice u/s. 143(2) premature/invalid as no return of income in response to notice u/s. 148 was filed. 4. It is the submission of the ld. Counsel of the assessee that the above ground has not been adjudicated by the Tribunal. 5. Per contra, the ld. DR submitted that there was no such ground raised by the assessee. Hence, it is submitted that there is no mistake apparent from the record. 6. We have carefully considered the submissions and peru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see has alleged that the reopening was done on bogus purchase while in completing the assessment, purchases were treated as genuine. This in our opinion has no merits. The Assessing Officer has confirmed 100% of the purchase as unexplained expenditure. 8. The ld. Counsel of the assessee has quoted case laws for the proposition that the above decision of the Tribunal was erroneous. In our considered opinion, if the assessee is not satisfied by the order of the Tribunal, it cannot lead to an inference that there is a mistake apparent from the record. 9. Further, the ld. Counsel of the assessee has challenged the tribunal's finding that the assessee was dealing in the grey market by a submission that all the payments were made by account p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t 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 concerned assessment year from different parties. Based upon this information assessment was reopened. The credibility of information relating to reopening has been confirmed by the learned CIT(A) and by ITAT as above. Furthermore it is noted that in such factual scenario Assessing Officer has made the necessary enquiry. The issue of notice to all the parties have returned unserved. 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. The necessary evidence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his proposition is totally unsustainable in light of above apex court decisions. 19. In these circumstances learned departmental representative has referred to Hon'ble Gujarat High Court decision in the case of Appeal No. 240 of 2003 in the case of N K Industries vs Dy CIT, 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 with others has been dismissed by the Hon'ble Apex Court vide order dated 16.1.2017. 20. We further note th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umstances of the present case indicate that assessee has engaged into dealings in the grey market. Dealings in the grey market give the assessee various savings at the expense of the Exchequer. Hence, on the overall consideration of facts and circumstances and following the decision of Hon'ble Gujarat High Court in the case of CIT vs Simit P. Sheth [2013] 356 ITR 451 (Guj.) we hold that a disallowance of 12.5% of the bogus purchase would meet the end of justice. Accordingly, we modify the order's of authorities below and direct that the disallowance in this case should be restricted to 12.5% of the bogus purchase. We also note here that before the Assessing Officer the assessee has itself relied upon the decision of Hon'ble Gujarat High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Hon'ble Apex Court decision and the decision of the Hon'ble High Courts referred hereinabove, the decisions of the tribunal referred by the ld. Counsel of the assessee are not relevant. Furthermore, those decisions were rendered on the facts of those cases. 12. From the above, we note that the ITAT had given a finding which was overwhelmingly in support of the Revenue department's action. Further, as a matter of fact, after noting the facts of the case and the case laws in para 20, the ITAT has noted that it was not the appeal by the Revenue and thereafter it had given relief to the assessee. In our considered opinion, there is no mistake apparent from the record in the order of the Tribunal as raised by the assessee. 13. We are of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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