IN THE INCOME-TAX APPELLATE TRIBUNAL“D” BENCH, MUMBAI BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER &

SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER ITA No. 2166/MUM/2025 (A.Y. 2010-11)

ITA No. 2167/MUM/2025 (A.Y. 2011-12)

Assistant Commissioner of v/s. M/s Romil Diam Income Tax – 19(3), Room No. बनाम 6/29 Capri, 9 Manav Mandir 513, 5^th Floor, Piramal Chamber, Road, Walkeshwar, Mumbai Mumbai – 400 012, Maharashtra – 400006, Maharashtra स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AAKFR7912A Appellant/अपीलाथी .. Respondent/

For Assessee : Shri Sanjay R. Parikh, CA For Revenue : Shri Annavaran Kosuri, (Sr. AR)

Date of Hearing 17.09.2025 Date of Pronouncement 10.11.2025 आदेश / O R D E R PER PRABHASH SHANKAR [A.M.] :-

The above captioned appeals ITA No. 2166/MUM/2025 and ITA No. 2167/Mum/2025 have been preferred by the Revenue pertaining to assessment orders u/s. 143(3) r.w.s 147 of the Income-tax Act, 1961 [hereinafter referred to as “Act”] as passed by the Learned Commissioner of Income-tax, (Appeals)/National Faceless Appeal Centre, Delhi [hereinafter referred to as “CIT(A)”] separately for the Assessment Years

2010-11 and 2011-12.

2. The grounds of the appeals are as under:-

ITA No. 2166/MUM/2025(A.Y. 2010-11)

1. “Whether the facts and circumstances of the case and in law. Ld.

CIT(A)has erred in restricting the addition to the extent of 8% as against the 100% made by the AO, on count of a bogus purchases transaction of Rs. 2,14,04,724/- with Me Aadi Kalash Enterprises, M/s. Rare Demands, Ms Millemium Stars, all are identified as bogus /paper entities of Mr. Bhanwarlal &

Rajendra Jain Group?”

2. “Whether on the facts and circumstances of the case and in law, Ld. CIT(A) has erred in restricting the addition to the extent of 8% as against the 100% addition of Rs. 2,14,04,724 by ignoring the fact that action of the Assessing officer was based on the information of the DGIT (Investigation Wing) Mumbai, who has proved beyond doubt with the evidences & recorded statements that all these Three paper concerns/entities were managed controlled by Mr. Bhanwarlal & Rajendra Jain Groups with a sole purpose of providing accommodation entries of bogus purchases & Loans and the assessee firm was found to be one of beneficiary who has obtained accommodation entries of bogus purchases of diamonds without actual delivery and this transaction were undertaken to generate paper tail only?.

3. “Whether on the facts and circumstances of the case and in law, Ld. CIT(A) has erred in restricting the addition rate to the extent of 8% as against 100% addition of Rs. 2,14,04,724/- without appreciating the fact that during the Search operations conducted no stock of diamonds or related materials was found and during the re-assessment proceedings, the assessee has failed to prove genuineness and creditworthiness of transactions as well as parties for vindication, by not producing the documents/evidences delivery challans, stock registers etc. before Assessing officer?”

4. “Whether in the facts and circumstances of the case, the Hon’ble ITAT was justified in confirming the decision of the ld.CIT(A) in holding that the income from bogus purchase transaction should be restricted to 8% of total value of purchase transactions although there was no dispute that the bogus purchases were made and so act of infraction of low was committed by the assessee on provision of section 74(1A) of the Maharashtra Value Added Tax Act 2002 and such purchases are not allowable as per express provision us. 37 of the Act?”

5. “Whether in the facts and circumstances of the case, the Hon’ble ITAT is perverse in not considering the order of Hon’ble Gujarat High Court in case of N.K. Industries Ltd (2016)72 Taxman.co 289 (Guj.) relating on similar issue of bogus purchase, which have been confirmed by the Hon’ble Supreme Court by dismissing SLP in SLPICC of 963/2017 dated 16.01.2017.

6. “Whether on the facts and circumstances of the case and in law, Ld.CIT(A) has erred in restricting the restricting the addition to