DEPUTY COMMISSIONER OF INCOME TAX (CENTRAL), SRINAGAR V. M/S STAR TRADERS, SRINAGAR

ITA 105/ASR/2025

AI Insights

The case involves an appeal by the revenue against the order of the CIT (A) - 5 Ludhiana, which set aside the assessment order passed by the DC/ACIT Central Circle, Srinagar. The original assessment was completed ex parte under section 153A following a search operation, leading to significant additions to the income of M/s Star Traders, primarily due to unexplained purchases and estimated profits from export and domestic sales. The CIT (A) set aside this assessment for a fresh evaluation, which the revenue challenged, arguing that the CIT (A) was not justified in setting aside the assessment without deciding on the merits.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 834192 (ITAT-AMRITSAR)
• Duration Of Justice: 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-02-2026
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 07-02-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: FARHAT KHAN
• Keywords: Set aside
• Section: 144; 132; 153A; 69C

Judgement Text

"आयकर अपीलȣय अͬधकरण,चÖडीगढ़ Ûयायपीठ, चÖडीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, ‘DB’ AMRITSAR BEFORE SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER & SHRI UDAYAN DASGUPTA, JUDICIAL MEMBER आयकर अपील सं./ ITA No. 105/ASR/2025 Ǔनधा[रण वष[ / Assessment Year: 2013-14 DCIT (Central), Srinagar Vs M/s Star Traders, 47d, New Fruit Complex, Sangam Paripora, Jammu & Kashmir, 190017 èथायी लेखा सं./PAN NO: ABEFM4466B अपीलाथȸ/Appellant Ĥ×यथȸ/Respondent VIRTUAL HEARING Assessee by : None Revenue by : Sh. Farhat Khan, CIT DR Date of Hearing : 02.02.2026 Date of Pronouncement : 03.02.2026 O R D E R Per Udayan Dasgupta, J.M.: This appeal is filed by the revenue against the order of the ld. CIT (A) – 5 Ludhiana, dated 24.12.2024 passed u/s 250 of the Income Tax Act, 1961 (henceforth the Act) which has emanated from the order of the DC/ACIT Central Circle, Srinagar, dated 31.03.2022 passed u/s 153A rws 144 of the Act. 2. In course of hearing there was no appearance by the assessee or his counsel on repeated calls, but considering the issues involved and Printed from counselvise.com ITA No. 105/ASR/2025 A.Y. 2013-14 2 the grounds contained we proceed to dispose off this appeal after hearing the Ld DR. 3. The Ld DR submitted that in the instant case assessment has been completed exparte u/s 153A, in pursuance of a search carried out on 02/09/2020 u/s 132 of the Act, and in absence of any return being filed in response to notices issued u/s 153A and in absence of any representation by the assessee to various notices subsequently issued, income has been determined at Rs. 9.26 crores (which included additions on account of unexplained purchase u/s 69C Rs.7.99 crores, plus an addition of Rs.63.93 lakhs being estimated profits on export sales calculated @ 8% of gross plus Rs. 63.61 lakhs being profits calculated @ 8% on unaccounted domestic sales). 4. The matter carried in appeal has been set aside to the files of the AO for fresh assessment, by the Ld CIT(A) by invoking the amended provisions u/s 251(1), considering the fact that the assessment has been completed u/s 144 of the Act. 5. The revenue has come up in appeal before the tribunal against the said order of the Ld CIT(A) on the ground that the Ld first appellate authority has not decided the issue on merits and was not justified in setting aside the assessment order. Printed from counselvise.com ITA No. 105/ASR/2025 A.Y. 2013-14 3 6. We find from records that the assessee is engaged in cross border trade ( barter basis - LOC trade ) and there has not been a single representation by the assessee at any stage before the AO and no books of accounts has been produced and the entire purchase for the year has been considered as income plus addition on account of estimated profits generated from export and import of goods under barter system @ eight percentage has been added back, both ways on sales as well on purchase. 7. On the facts, the Ld first appellate authority has rightly set aside the matter under the amended provisions of section 251(1) of the Act, for denovo fresh assessment and we are fully in agreement with the decision of the Ld CIT ( A ). 8. We have not expressed any opinion on merits and all issues are left open. 9. In the result the appeal of the revenue is dismissed being devoid of merits. Order pronounced on 03.02.2026. SD/- SD/- (MANOJ KUMAR AGGARWAL) (UDAYAN DASGUPTA) ACCOUNTANT MEMBER JUDICIAL MEMBER “rkk” Printed from counselvise.com ITA No. 105/ASR/2025 A.Y. 2013-14 4 आदेश कȧ ĤǓतͧलͪप अĒेͪषत/ Copy of the order forwarded to : 1. अपीलाथȸ/ The Appellant 2. Ĥ×यथȸ/ The Respondent 3. आयकर आयुÈत/ CIT 4. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय आͬधकरण, चÖडीगढ़/ DR, ITAT, CHANDIGARH 5. गाड[ फाईल/ Guard File आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar Printed from counselvise.com "