DCIT 13(1)(1), MUMBAI vs. UNITED ASPHALTERS P.LTD, MUMBAI

आदेश / O R D E R Per Joginder Singh(Judicial Member) This bunch of five appeals is by the Revenue as well as the assessee against the impugned orders all dated 29/01/2016 of the Ld. First Appellate Authority, Mumbai, on account of bogus purchases and the consequent addition made u/s 69C of the Income Tax Act, 1961 (hereinafter the Act).

hearing is over, the matter was taken up with respect to and corrigendum was issued with the consent of the ld. representatives from both sides. As per which, the order was rectified with respect to adoption of net profit at 12.50% and the word ‘minus GP’ was removed and thus, the order of the Ld. Commissioner of Income Tax (Appeal) was affirmed.

2.1. In the appeal for Assessment Year 2009-10, it is noted that the Tribunal dismissed the appeal of the Revenue vide aforesaid order dated 06/07/2017. The relevant portion of this order is reproduced hereunder:-

“The Revenue is aggrieved by the impugned order dated 29/01/2016 of the Ld. First Appellate Authority, Mumbai, restricting the addition to 12.5% on account of non-genuine purchases ignoring that the assessee has not substantiated as to how the alleged purchases were used in the manufacturing process and further restricting the addition to Rs.5,367/- as against Rs.60,6696/- made on account of commission at the rate of 1% paid to non-genuine purchase party for arranging the bill and other related paper work as the assessee could not disprove the statements of hawala parties.

Apex Court, so that we can reach to a proper conclusion. The Hon'ble Gujarat High Court in Sanjay Oilcakes Industries vs CIT (2009) 316 ITR 274 (Guj.) held as under:-

“11. Having heard the learned advocates appearing for the respective parties, it is apparent that no interference is called for in the impugned order of the Tribunal dated April 29, 1994, read with the order dated September 29, 1994, made in miscellaneous application. In the principal order the Tribunal has recorded the following findings :

"8.3. We have considered the rival submissions and perused the facts on record. In our opinion, the action of the Commissioner of Income-tax (Appeals) confirming 25 per cent. of the amounts claimed is fair and reasonable and no interference is called for. The Commis sioner of Income-tax (Appeals) has gone through the purchase prices of the raw material prevalent at the time and rightly came to the con clusion that the disallowance to the extent of 25 per cent. was called for. It is established that the parties were not traceable ; they opened the bank accounts in which the cheques were credited but soon thereafter the amounts were withdrawn by bearer cheques. That fairly leads to the conclusion that these parties were perhaps creation of the assessee itself for the purpose of banking purchases into books of account because the purchases with bills were not feasible. Thus, the abovenoted parties become conduit pipes between the assessee-firm and the sellers of the raw materials. Under the circumstances, it was not impossible for the assessee to inflate the prices of raw materials. Accordingly, an addition at the rate of 25 per cent. for extra price paid by the assessee than over and above the prevalent price is fair and reasonable and we accordingly confirm the finding of the Commis sioner of Income-tax (Appeals)."

12. Thus, it is apparent that both the Commissioner (Appeals) and the Tribunal have concurrently accepted the finding of the Assessing Officer that the apparent sellers who had issued sale bills were not traceable. That goods were received from the parties other than the persons who had issued bills for such goods. Though the purchases are shown to have been made by making payment thereof by account payee cheques, the cheques have been deposited in bank accounts ostensibly in the name of the apparent sellers, thereafter the entire amounts have been withdrawn by bearer cheques and there is no trace or identity of the person withdrawing the amount from the bank accounts. In the light of the aforesaid nature of evidence it is not possible to record a different conclusion, different from the one recorded by the Commissioner (Appeals) and the Tribunal , 1729, 2598, 5 2599 & 2600/Mum/2016 M/s. United Asphalters P. Ltd.

concurrently holding that the apparent sellers were not genuine, or were acting as conduit between the assessee- firm and the actual sellers of the raw materials. Both the Commissioner (Appeals) and the Tribunal have, therefore, come to the conclusion that in such circumstances, the likelihood of the purchase price being inflated cannot be ruled out and there is no material to dislodge such finding. The issue is not whether the purchase price reflected in the books of account matches the purchase price stated to have been paid to other persons. The issue is whether the purchase price paid by the assessee is reflected as receipts by the recipients. The assessee has, by set of evidence available on record, made it possible for the recipients not being traceable for the purpose of inquiry as to whether the payments made by the assessee have been actually received by the apparent sellers. Hence, the estimate made by the two appellate authorities does not warrant interference. Even otherwise, whether the estimate should be at a particular sum or at a different sum, can never be an issue of law.”

In the aforesaid case, the Hon'ble High Court accepted that the apparent sellers, who issued the said bills were not traceable and the goods received from parties other than the persons, who had issued the bills for such goods. The purchases were shown to have been made by making payments, through banking channel and thus the apparent sellers were not genuine or were acting as conduit between the assessee and the actual seller. In such a situation, the conclusion drawn by the Ld. Commissioner of Income Tax (Appeal) as well as by the Tribunal was affirmed. Hon'ble Apex Court in Kachwala Gems vs JCIT (2007) 158 taxman 71 observed that an element of guesswork is inevitable in cases, where estimation of income is warranted. 2.2. The Hon'ble Gujarat High Court in CIT vs Bholanath Poly Fab. Pvt. Ltd. (2013) 355 ITR 290 (Guj.) held/observed as under:- “5. Having come to such a conclusion, however, the Tribunal was of the opinion that the purchases may have been made from bogus parties, nevertheless, the purchases themselves were not bogus. The Tribunal adverted to the facts and data on record and came to the conclusion that the entire quantity of opening stock, purchases and the quantity manufactured during the year under consideration were sold by the assessee. Therefore, the purchases of the entire 1,02,514 metres of cloth were sold during the year under consideration. The Tribunal, therefore, accepted the assessee's contention that the , 1729, 2598, 6 2599 & 2600/Mum/2016 M/s. United Asphalters P. Ltd. finished goods were purchased by the assessee, may be not from the parties shown in the accounts, but from other sources. In that view of the matter, the Tribunal was of the opinion that not the entire amount, but the profit margin embedded in such amount would be subjected to tax. The Tribunal relied on its earlier decision in the case of Sanket Steel Traders and also made reference to the Tribunal's decision in the case of Vijay Proteins Ltd. v. Asst. CIT [1996] 58 ITD 428 (Ahd).

2.3. Likewise, the Hon'ble Gujarat High Court in CIT vs Vijay M. Mistry Construction Ltd. (2013) 355 ITR 498 (Guj.) held/observed as under:-

“6. As is apparent from the facts noted hereinabove, the Commissioner (Appeals) after appreciating the evidence on record has found that the assessee had in fact made the purchases and, hence, the Assessing Officer was not justified in disallowing the entire amount. He, however, was of the view that the assessee had inflated the purchases and, accordingly, by placing reliance on the decision of the Tribunal in the case of Vijay Proteins (supra) restricted the disallowance to 20 per cent. The Tribunal in the impugned order has followed its earlier order in the case of Vijay Proteins to the letter and enhanced the disallowance to 25 per cent. Thus, in both cases, the decision of the Commissioner (Appeals) as well as that of the Tribunal is based on estimate. This High Court in the case of Sanjay Oil Cake [2009] 316 ITR 274 (Guj) has held that whether an estimate should be at a particular sum or at a different sum can never be a question of law.

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10. As regards the proposed question (B) which pertains to the deletion of addition of Rs. 7,88,590 made on account of inflation of expenses paid to Metal and Machine Trading Co. (MMTC), the Assessing Officer has found that MMTC was a partnership firm of Shri Nitin Gajjar along with his father and brother operating from Bhavnagar. A perusal of their transactions with the assessee indicated that there is some inflation of expenses as detailed in paragraph 6.1 of the assessment order. After considering the evidence on record, the Assessing Officer disallowed the amount Rs. 7,88,590 on account of payment made to MMTC.

11. The assessee preferred an appeal before the Commissioner (Appeals), who upon appreciation of the evidence on record found that the Assessing Officer had not rejected the genuineness of the purchases made from MMTC while making the disallowance. His observations were based on inflation of rates which were being charged from the assessee. According to the Commissioner (Appeals), though MMTC in some respect could be attributed to be associated with the assessee-company, still it could not be expected that MMTC was carrying out its business without any motive or profit. According to the Commissioner (Appeals), it was proved by the assessee that the rates charged by MMTC were comparable with the prevailing market rates, no such addition can stand. The Commissioner (Appeals) took note of the fact that it was not the case of the Assessing Officer that the purchases had been directly effected from third parties and not directly from MMTC ; the difference could not be the net profit in the hands of MMTC ; and that while conducting the entire exercise MMTC would have to incur certain expenditure in transportation, in engaging personnel in the office and other operations and was accordingly of the view that there was no case of actual inflation of rates and deleted the addition.

relevant material has not been taken into consideration. In the absence of any material to the contrary being pointed out on behalf of the Revenue, the impugned order being based on concurrent findings of fact recorded by the Tribunal upon appreciation of the evidence on record, does not give rise to any question of law in so far as the present ground of appeal is concerned.

14. In relation to the proposed question (F) which relates to the deletion of addition of Rs. 44,54,426 made on account of purchase of crane and allowing depreciation on the same, the Assessing Officer observed that the assessee had purchased a crawler crane for an amount of Rs. 24,61,000 excluding the cost of spare parts of Rs. 14,98,490. The Assessing Officer after examining the evidence on record and considering the explanation given by the assessee, made addition of Rs. 44,54,426, Rs. 39,59,490 being the purchase price of the crane along with its spare parts and Rs. 4,94,936 being depreciation claimed by the assessee. The Commissioner (Appeals), upon appreciation of evidence on record, was of the view that the Assessing Officer has not appreciated the facts of the case properly and had made disallowance which was not permitted by the Income- tax Act. It was held that disallowance could only have been made in respect of expenses debited to the profit and loss account whereas in the present case the purchase of crane and spare parts of the crane and other machineries were in the nature of acquisition of capital asset. According to the Commissioner (Appeals), the disallowance could have been made on depreciation only if at all the Assessing Officer conclusively proved that the purchases of crane and other parts are bogus. Upon appreciation of the material on record the Commissioner (Appeals) found that the Assessing Officer has simply brushed aside all the evidence on account of technical infirmities and that the evidence such as octroi receipt ; hypothecation of the crane to the bank; existence of the crane even till date with the assessee conclusively proved that the crane was purchased and it was in use even as on date with the assessee. The Commissioner (Appeals) accordingly found that there was no scope for any disallowance and accordingly deleted the disallowance made on account of purchase of crane and allowed the depreciation as claimed by the assessee.

15. The Tribunal, in the impugned order, has noted that the cost of crane was never claimed by the assessee in the return of income. Before the Tribunal, the assessee produced the evidence that the crane in question was registered with the RTO and the same was wholly and exclusively used for the purposes of its business. The Tribunal, therefore, held that the Commissioner (Appeals) was legally and factually correct in deleting the disallowance of cost of crane as well as depreciation thereon.

16. From the facts emerging from the record, it is apparent that the assessee had never claimed the cost of the crane in the return nor had it debited the expenses to the profit and loss account, and as such the question of disallowing the same and adding the same to the income would not arise. Moreover, in the absence of any evidence to indicate that the purchase was bogus or that the crane in fact did not exist, the question of disallowing the deprecation in respect of the same also would not arise. When the assessee had conclusively proved the purchase and existence of the crane, and had not debited , 1729, 2598, 9 2599 & 2600/Mum/2016 M/s. United Asphalters P. Ltd.

the expenses to the profit and loss account, no addition could have been made in respect of the purchase price nor could have depreciation been disallowed in respect thereof. The Tribunal was, therefore, justified in deleting the addition as well as disallowance of depreciation.

2.5. The Hon'ble jurisdictional High Court in CIT vs Nikunj Exim Enterprises Pvt. Ltd. (2015) 372 ITR 619 (Bom.) held/observed as under:- “7. We have considered the submission on behalf of the Revenue. However, from the order of the Tribunal dated April 30, 2010, we find that the Tribunal has deleted the additions on account of bogus purchases not only on the basis of stock statement, i.e., reconciliation statement but also in view of the other facts. The Tribunal records that the books of account of the respondent-assessee have not been rejected. Similarly, the sales have not been doubted and it is an admitted position that substantial amount of sales have been made to the Government Department, i.e., Defence Research and Development Laboratory, Hyderabad. Further, there were confirmation letters filed by the suppliers, copies of invoices for purchases as well as copies of bank statement all of which would , 1729, 2598, 10 2599 & 2600/Mum/2016 M/s. United Asphalters P. Ltd. indicate that the purchases were in fact made. In our view, merely because the suppliers have not appeared before the Assessing Officer or the Commissioner of Income-tax (Appeals), one cannot conclude that the purchases were not made by the respondent-assessee. The Assessing Officer as well as the Commissioner of Income-tax (Appeals) have disallowed the deduction of Rs. 1.33 crores on account of purchases merely on the basis of suspicion because the sellers and the canvassing agents have not been produced before them. We find that the order of the Tribunal is well a reasoned order taking into account all the facts before concluding that the purchases of Rs. 1.33 crores was not bogus. No fault can be found with the order dated April 30, 2010, of the Tribunal.”

2.6. The Hon'ble Gujarat High Court in CIT vs M.K. Brothers (163 ITR 249) held/observed as under:-

“Being aggrieved by the aforesaid order, the assessee went in second appeal before the Tribunal. It was urged on behalf of the assessee that the transactions in question were normal business transactions and the assessee had made payments by cheques. The parties did not come forward and if they did not come, the assessee should not suffer. However, on behalf of the Revenue, it was urged that detailed inquiries were made and thereafter the conclusion was reached. The Tribunal found that there was no evidence anywhere that these concerns gave bogus vouchers to the assessee. No doubt, there were certain doubtful features, but the evidence was not adequate to conclude that the purchases made by the assessee from the said parties were bogus. The Tribunal accordingly, did not sustain the addition retained by the Appellate Assistant Commissioner. Hence, at the instance of the Revenue, the aforesaid question has been referred to this court for opinion.

On a perusal of the order of the Tribunal, it clearly appears that whether the said transactions were bogus or not was a question of fact. The Tribunal has also pointed out that nothing is shown to indicate that any part of the fund given by the assessee to these parties came back to the assessee in any form. It is further observed by the Tribunal that there is no evidence anywhere that these concerns gave vouchers to the assessee. Even the two statements do not implicate the transactions with the assessee in any way. With these observations, the Tribunal ultimately has observed that there are certain doubtful features, but the evidence is not adequate to conclude that the purchases made by the assessee from these parties were bogus. It may be stated that the assessee was given credit facilities for a short duration and the payments were given by cheques. When that is so, it cannot be said that the entries for the purchases of the goods made in the books of account were bogus entries. We, therefore, do not find that the conclusion arrived at by the Tribunal is against the weight of evidence. In that view of the matter, we answer the question in the affirmative, that is, in favour of the assessee and against the Revenue. Accordingly, the reference stands disposed of with no order as to costs.”

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2.7. The Mumbai Bench of the Tribunal in the case of DCIT vs Rajeev G. Kalathil (2015) 67 SOT 52 (Mum. Trib.)(URO), identically, held as under:- “2.2.Aggrieved by the order of the AO, assessee preferred an appeal before the First Appellate Authority(FAA).Before him it was argued that assessee had filed copies of bills of purchase from DKE and NBE, that both the suppliers were registered dealers and were carrying proper VAT and registration No.s, that ledger accounts of the parties in assessee's books showed bills accounted for, that payment was made by cheques, that a certificate from the banker giving details of cheque payment to the said parties was also furnished. Copies of the consignment, received from the Government approved transport contractors showing that material purchased was actually delivered at the site was furnished before the AO. It was also argued that some of the material purchased from the said parties were lying part of closing stock as on 31.03.2009 as per the statement submitted on record. After considering the assessment order and the submissions made by the assessee, FAA held that the transactions were supported by proper documentary evidences, that the payments made to the parties by the assessee were in confirmation with bank certificate,t hat the suppliers was shown as default under the Maharashtra VAT Act could not be sufficient evidences to hold that the purchases were non-genuine, that the AO had not brought any independent and reliable evidences against the assessee to prove the non-genuineness of the purchases, that there was no evidence regarding cash received back from the suppliers. Finally, he deleted the addition made by the AO . “2.3.Before us, Departmental Representative argued that both the suppliers were not produced before the AO by the assessee, that one of them was declared hawala dealer by VAT department, that because of cheque payment made to the supplier transaction cannot be taken as genuine. He relied upon the order of the G Bench of Mumbai Tribunal delivered in the case of Western Extrusion Industries. (ITA/6579/Mum/2010- dated 13.11.2013). Authrorised representative (AR) contended that payments made by the assessee were supported by the banker’s statement, that goods received by the assessee from the supplie was part of closing stock,that the transporter had admitted the transportation of goods to the site.He relied upon the case of Babula Borana (282 ITR251), Nikunj Eximp Enterprises (P) Ltd. (216Taxman171)delivered by the Hon’ble Bombay High Court. 2.4.We have heard the rival submissions and perused the material before us. We find that AO had made the addition as one of the supplier was declared a hawala dealer by the VAT Department. We agree that it was a good starting point for , 1729, 2598, 12 2599 & 2600/Mum/2016 M/s. United Asphalters P. Ltd. making further investigation and take it to logical end. But, he left the job at initial point itself. Suspicion of highest degree cannot take place of evidence. He could have called for the details of the bank accounts of the suppliers to find out as whether there was any immediate cash withdrawal from their account. We find that no such exercise was done. Transportation of good to the site is one of the deciding factor to be considered for resolving the issue. The FAA has given a finding of fact that part of the goods received by the assessee was forming part of closing stock. As far as the case of Western Extrusion Industries. (supra)is concerned, we find that in that matter cash was immediately withdrawn by the supplier and there was no evidence of movement of goods. But, in the case before us, there is nothing, in the order of the AO, about the cash traial. Secondly, proof of movement of goods is not in doubt. Thererfore, considering the peculiar facts and circumstances of the case under appeal, we are of the opinion that the order of the FAA does not suffer from any legal infirmity and there are not sufficient evidence on file to endorse the view taken by the AO. So, confirming the order of the FAA, we decide ground no.1 against the AO.” 2.8. The ratio laid down in the case of M/s Neeta Textiles vs Income Tax Officer 6138/Mum/2013, order dated 27/05/2013, Shri Jigar V. Shah vs Income Tax Officer (ITA No.1223/M/2014) order dated 22/01/2016, M/s Imperial Imp. & Exp. vs Income Tax Officer order dated 18/03/2016 supports the case of the assessee and the conclusion drawn in the impugned order. However, as relied by the Ld. DR, the Hon'ble Gujarat High Court in the case of N.K. Industries Ltd.,etc vs DCIT (supra) considering various decisions decided the issue in favour of the Revenue and the Hon'ble Apex Court dismissed the SLP vide order dated 16/01/2017 (SLP No.(c) 769 of 2017). We find that in that case, during search proceedings, certain blank signed cheque books and vouchers were found and thus the purchases made from these concerns, were treated as bogus by the Assessing Officer. 2.9. The Hon'ble Gujarat High Court in N.K. Industries Ltd. vs DCIT (IT Appeal No.240, 261, 242, 260 and 241 of 2003), vide order dated 20/06/2016 considered the decision of the Tribunal and various judicial decisions including the case of Vijay Proteins and Sanjay Oilcakes Industries ltd., M/s Woolen Carpet Factory vs ITAT (2002) 178 CTR 420 (Raj.), the Tribunal was held to be justified in deciding the case against the assessee. The Hon'ble Apex Court confirmed the decision of the High Court for adding the entire income on account of bogus purchases (SLP (C) No.s 769 of 2017, order dated 16/01/2017.

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2.10. Broadly, the Ld. DR place reliance upon the decision from Hon'ble Gujarat High Court in the case of N.K. Industries Ltd. vs DCIT (IT Appeal No.240 of 2003 & etc.). and in the case of N.K. Proteins Ltd. vs DCIT (SLP No.769 of 2017), which was dismissed, confirming the decision of the Hon'ble High Court for making the addition of entire income on account of bogus purchases, whereas, the order of the Ld. Commissioner of Income Tax (Appeal) is based upon various decisions including Hon'ble jurisdictional High Court in the case of CIT vs M/s Nikunj Eximp Enterprises Pvt. Ltd. (ITA No.5604 of 2010) and in ACIT vs Mahesh K. Shah (ITA No.5194/Mum/2014) Order dated 31/01/2017, CIT vs Ashish International (ITA No.4299/2009) (Bom.) and Income Tax Officer vs M/s Vaman International Pvt. Ltd. (ITA No.794/Mum/2015) order dated 16/11/2016. 2.11. In such type of cases, broadly, the Ld. Commissioner of Income Tax (Appeal) as well as this Tribunal has followed the decisions from Hon'ble Gujarat High Court in the case of Simit P. Seth (2013) 356 ITR 451 (Guj.), CIT vs Vijay M. Mistry Construction Ltd. (2013) 355 ITR 498 (Guj.), CIT vs Bhola Nath Poly Fab. (P.) Ltd. (2013) 355 ITR 290 (Guj.) and various other decisions of the Tribunal and the decision of M/s Nikunj Eximp(supra) from Hon'ble jurisdictional High Court, wherein, the aggregate disallowance was restricted to 12.5%. The case of the Revenue is that there is bogus nature of purchases made from suppliers and the parties were not found existing at the given addresses. We find that the fact in the present appeal is different because in these cases before us, as the assessee is a trader and as mentioned earlier there cannot be sale without any purchases. In the present appeal, the facts, in brief, are that the assessee is engaged in the business of running hot mix plant and execution of road construction contracts, declared income of Rs.15,53,320/- in its return filed on 28/09/2009, which was processed u/s 143(1) of the Act. Later on the case of the assessee was reopened u/s 147 and the assessment was completed u/s 143(3) r.w.s 147 of the Act by making the addition of Rs.61,48,013/-, assessing the total income at Rs.77,01,333/-. During assessment proceedings, the Ld. Assessing Officer received information from the investigation wing that the assessee made bogus purchases of Rs.60,69,679/- from three parties. The case of the Revenue is that the assessee could not explained the genuineness of such purchases/expenditure and thus the addition was rightly made u/s 69C of the Act. Whereas, the case of the assessee is that necessary details for the alleged bogus purchases were duly filed by the assessee, explaining the genuineness of the purchases. The First Appellate Authority considered various judicial decisions including Bholanath Poly Fab Pvt. Ltd. (2013)

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355 ITR 290 and CIT vs Simit P. Seth (2013) 219 taxman 85 (Guj.) and thereafter decided the issue. The stand of the Revenue is that the assessee failed to prove, beyond reasonable doubt, that the assessee made purchases from the genuine parties, therefore, the addition of Rs.61,30,375/- was rightly made. 2.12. If the observation made in the assessment order, leading to addition made to the total income, conclusion drawn in the impugned order, material available on record, if kept in juxtaposition and analyzed, admittedly, in such type of cases, there is no option but to estimate the profit which depends upon the subjective approach of an individual. However, keeping in view the principle of judicial discipline, ratio laid down in the aforesaid cases (discussed hereinabove), to plug the leakage of revenue, we deem it appropriate to adopt the net profit of 12.50% of the purchases made by the assessee minus the GP, already declared/ shown by the assessee. So far as, the case relied upon by Ld. DR in his written submissions is concerned, that is different on fact as the present assessee is a trader in goods, thus, we affirm the stand of the Ld. Commissioner of Income Tax (Appeal).

We are also reproducing hereunder the corrigendum issued in the aforesaid order on 06/12/2017 for ready reference:-

Corrigendum

“We find that the Tribunal disposed off the aforesaid appeal of the Revenue vide order dated 06/07/2017. During hearing of the remaining appeals of difference Assessment Years including Assessment Years 2009-10, (appeal of the assessee), the ld. counsel for the assessee cited order of the Tribunal dated 06/07/2017, wherein an inadvertent typographical error was noticed. The ld. counsel for the assessee, Shri Dharmesh Shah as well as Shri Rajat Mittal, , 1729, 2598, 15 2599 & 2600/Mum/2016 M/s. United Asphalters P. Ltd. ld. DR, agreed that the mistake may be rectified. Both were heard. After hearing both sides, it was found that due to inadvertent typographical error, some mistake occurred in the order in para 2.12 (page-16 of the order), which is reproduced hereunder:- “2.12. If the observation made in the assessment order, leading to addition made to the total income, conclusion drawn in the impugned order, material available on record, if kept in juxtaposition and analyzed, admittedly, in such type of cases, there is no option but to estimate the profit which depends upon the subjective approach of an individual. However, keeping in view the principle of judicial discipline, ratio laid down in the aforesaid cases (discussed hereinabove), to plug the leakage of revenue, we deem it appropriate to adopt the net profit of 12.50% of the purchases made by the assessee minus the GP, already declared/ shown by the assessee. So far as, the case relied upon by Ld. DR in his written submissions is concerned, that is different on fact as the present assessee is a trader in goods, thus, we affirm the stand of the Ld. Commissioner of Income Tax (Appeal).” We note that (on going through the record) the Tribunal adopted the net profit at 12.50% of the purchases made by the assessee minus the GP already declared/shown by the assessee. The Ld. Commissioner of Income Tax (Appeal) adopted the figure of 12.50% and the Tribunal affirmed the stand of the Ld. Commissioner of Income Tax (Appeal). However, if the profit at the rate of 12.50% of the bogus purchases is affirmed then there is no question of minus the GP already declared by the assessee, therefore, the necessary correction is made and the para 2.12 may be read as under:- “2.12. If the observation made in the assessment order, leading to addition made to the total income, conclusion drawn in the impugned order, material available on record, if kept in juxtaposition and analyzed, admittedly, in such type of cases, there is no option but to estimate the profit which depends upon the subjective approach of an individual. However, keeping in view the principle of judicial discipline, ratio laid down in the aforesaid cases (discussed hereinabove), to plug the leakage of revenue, we deem it appropriate to adopt the net profit of 12.50% of the purchases, adopted by the Ld. Commissioner of Income Tax (Appeal). So far as, the case relied upon by Ld. DR in his written submissions is concerned, that is different on fact as the present assessee is a trader in goods, thus, we affirm the stand of the Ld. Commissioner of Income Tax (Appeal).”

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The Ld. Assessing Officer is directed to act upon the corrigendum order issued hereinabove. This correction/corrigendum was told to the ld. representatives from both sides and they agreed to it. Thus, this corrigendum is issued today on 06/12/2017.”

In the light of the above, since, we have upheld the order of the Ld. Commissioner of Income Tax (Appeal), therefore, on the aforesaid reasoning/judicial pronouncements, we dismissed appeal of the assessee for Assessment Year 2009-10 (ITA No.2598/Mum/2016) as the same is borne out from the same order and the order of the Tribunal dated 06/07/2017 (ITA No.1823/Mum/2016) in the appeal of the Revenue for Assessment Year 2009-10 (including the corrigendum issued) shall be applicable, therefore, the appeal of the assessee for Assessment Year 2009-10 is dismissed.

3. The ground with respect to reopening of assessment was not argued by the Ld. counsel for the assessee, therefore, dismissed as not pressed.

Finally, the appeal for Assessment Year 2009-10, filed by the assessee, is dismissed.

No.2599/Mum/2016) (appeal of the assessee), the ground with respect to reopening of assessment as invalid was not argued by the Ld. counsel for the assessee, therefore, it is dismissed as not pressed.

6. Identical is the situation/facts for Assessment Year 2011-12, therefore, following the orders for Assessment Year 2009-10, which was followed for Assessment Year 2010-11 also, resulting into upholding the order of the First , 1729, 2598, 18 2599 & 2600/Mum/2016 M/s. United Asphalters P. Ltd.

Appellate Authority, the appeal of the assessee as well as of the Revenue are dismissed, Finally, (i) The appeal of the assessee for Assessment Year 2009-10 is dismissed. (ii) The appeal of the assessee as well as of the Revenue for Assessment Year 2010-11 are dismissed. (iii) The appeal of the assessee as well as of the Revenue for Assessment Year 2011-12 are also dismissed

This order was pronounced in the open court in the presence of ld. representative from both sides at the conclusion of the hearing on 06/12/2017.