Petitioner raised a grievance before ITAT that CIT(A) has erred in sustaining 12.5% disallowance on account of bogus purchases and also in upholding the validity of re-opening. In the Appeal before ITAT various grounds were raised including the challenge to re-opening itself. According to Petitioner there was no tangible material. Moreover Petitioner also alleged that reliance has been placed upon information received by Revenue from Maharashtra Sales Tax Authority that Assessee was beneficiary of Hawala accommodation entries from entry provider by way of bogus purchase. It is also alleged that accommodation entry provider has deposed and admitted before Maharashtra Sales Tax Authority vide statement/affidavit that they were engaged in providing bogus accommodation entries wherein bogus sales bills were issued without delivery of goods, in consideration for commission. It is stated that Assessee was one of the beneficiaries of this bogus entries of sale of material from Hawala entry providers. These accommodation entry providers on receipt of cheques from parties against bogus bills for sale of material, later on withdrew cash from their bank accounts which were returned to beneficiaries of bogus bills after deduction of their agreed commission. Petitioner challenged that order before the Income Tax Appellate Tribunal (ITAT) which was  dismissed.  The miscellaneous application of the petitioner was also dismissed. On writ the petitioner contended  that  these details/information like admission of accommodation entry provider before Maharashtra Sales Tax Authority implicating Petitioner has not been provided to Petitioner despite repeated requests. This ground has been raised before ITAT.   The Honourable Court referred the judgement in   In S. Nagaraj & Ors. v. State of Karnataka, 1993 Supp (4) SCC 595, Sahai, J. stated:

“15. Justice is a virtue which transcends all barriers. Neither the rules of procedure nor technicalities of law can stand in its way. The order of the Court should not be prejudicial to anyone. Rule of stare decisis is adhered for consistency but it is not as inflexible in Administrative Law as in Public Law. Even the law bends before justice. Entire concept of writ jurisdiction exercised by the higher courts is founded on equity and fairness. If the Court finds that the order was passed under a mistake and it would not have exercised the jurisdiction but for the erroneous assumption which in fact did not exist and its perpetration shall result in miscarriage of justice then it cannot on any principle be precluded from rectifying the error. Mistake is accepted as valid reason to recall an order. Difference lies in the nature of mistake and scope of rectification, depending on if it is of fact or law. But the root from which the power flows is the anxiety to avoid injustice. It is either statutory or inherent. The latter is available where the mistake is of the Court. In Administrative Law, the scope is still wider. Technicalities apart if the Court is satisfied of the injustice then it is its constitutional and legal obligation to set it right by recalling its order”….. (p.618)”.

The Honourable Court allowed the petition and directed the Tribunal to follow the ratio in  PCIT v. Mohommad Haji Adam & Co. ITA No. 1004 of 2016 dated 11/02/2019.