TMI Blog2021 (7) TMI 1191X X X X Extracts X X X X X X X X Extracts X X X X ..... of the possible view with due application of mind which could not be termed as perverse, in any manner. There could be no sale without actual purchase of goods keeping in view the nature of assessee s business. The action of Ld. AO was in conformity with the ratio of various judicial pronouncements as enumerated in para 6.4 of the assessment order. In view of the foregoing, it could very well be said that the view of Ld. AO was one of the possible view which was not contrary to law or unsustainable in law. Merely because Ld. Pr. CIT held a view that the estimation should have been at higher rates or entire purchase should have been disallowed, the same would not make the order erroneous unless it was found that the action of Ld. AO was not in accordance with law or perverse, in any manner. This being the case, the revision could not be held to be justified as per the ratio laid down by jurisdictional High court in Grasim Industries Ltd.[ 2010 (2) TMI 4 - BOMBAY HIGH COURT] . Also see assessee's own case [ 2020 (11) TMI 167 - ITAT MUMBAI] We hold that revisional jurisdiction was invalidly exercised and therefore, liable to be set-aside - Decided against revenue. - I.T. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter after due application of mind. Therefore, the revisional jurisdiction was bad in law. The written submissions have also been filed along with supporting case laws. Reliance has been placed on the decision of this Tribunal in assessee s own case for AY 2009-10 in ITA No.2370/Mum/2018 dated 28/09/2020 wherein revisional order passed under similar factual matrix was quashed by the bench. The Ld. CIT-DR, on the other hand, submitted that in terms of Explanation-2 to Sec.263, Ld. AO failed to conduct proper enquiries during original assessment proceedings and therefore, jurisdiction was validly exercised. 3. We have carefully heard the rival submissions and perused relevant material on record including the cited case laws. Our adjudication to the subject-matter of appeal would be as given in succeeding paragraphs. 4. The material facts are that the assessee being resident firm stated to be engaged in manufacturing trading of diamonds was assessed for the year under consideration u/s. 143(3) on 30/12/2016 wherein it was saddled with estimated addition of 1.6% against certain bogus purchases stated to be made by the assessee from 6 entities allegedly run by entry provid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... various details and documentary evidences furnished during assessment proceedings and submitted that there was no error in the order. 5.3 However, not convinced, Ld. Pr. CIT opined that the issue was to be decided keeping in view the principle laid down in the case of N.K. Proteins Ltd. (2017-TIOL-23-SC-IT) in SLP (C) CC No.769 of 2017 dated 16/01/2017 and therefore, addition should have been made to the extent of 100%. Finally, the assessment order was set aside and Ld. AO was directed to pass fresh order in terms of this decision. Aggrieved, the assessee is in further appeal before us and challenges the validity of revisional jurisdiction. Our Adjudication 6. Upon careful consideration of queries raised by Ld. AO during original assessment proceedings and the assessee s replies thereto, we find that Ld. AO was clinched with the issue of suspicious purchases made by the assessee from various entities of tainted group. In fact, it is the only addition made in the assessment order. Specific queries were raised requiring the assessee to substantiate the purchases under suspicion. The assessee produced requisite details and documentary evidences including stock rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO from DIT (Inv.)-2, Mumbai to the effect that assessee is beneficiary of bogus hawala purchases from 9 parties aggregating to ₹ 26,73,39,615/- and thus the income has escaped assessment. Thereafter, the assessment was framed under section 143(3) read with section 147 of the Act assessing the total income at ₹ 48,88,440/- wherein an addition of ₹ 40,10,094/- was made towards assessing the profit element in the bogus purchases of ₹ 26,73,39,615/- calculated at 1.5% of the total alleged bogus purchases. The Ld. PCIT has exercised the revisionary jurisdiction on the ground that AO has not correctly assessed the income from bogus purchases by relying on the decision of Hon ble Supreme Court in the case of N.K. Proteins vs. DCIT (supra) and Vijay Proteins Ltd. vs. CIT (supra). The undisputed facts are that the issue has been examined by the AO during the reassessment proceedings as the assessment was reopened only to examine the issue of escapement of income resulting from bogus purchases and the assessment was framed by the AO after making addition of ₹ 40,10,094/-. Thus the Ld. PCIT proposes to exercise the revisionary jurisdiction only qua the same ..... X X X X Extracts X X X X X X X X Extracts X X X X
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