INCOME TAX OFFICER, MODEL TOWN ROAD V. NITIN DUTTA, KALIA COLONY

ITA 455/ASR/2024

AI Insights

The case involves an appeal by the Income Tax Officer against the decision of the Commissioner of Income Tax (Appeals), which pertained to the assessment year 2018-19. The primary issue was the disallowance of purchases amounting to Rs.60.45 Crores, which the Assessing Officer categorized as bogus under section 69C of the Income Tax Act. The CIT(A) had reduced the addition to 25% after considering the assessee's submissions, which included detailed documentation of transactions and compliance with GST regulations. The tribunal, after reviewing the submissions and the CIT(A)'s reasoning, decided to uphold the CIT(A)'s decision, dismissing the revenue's appeal.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 835802 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 5 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2026
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2018-2019
• Appeal Filed On: 14-08-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASSESSEE SINCE PAST MANY
• Assessee Lawyers: FARHAT KHAN LD
• Keywords: Bogus purchase; Bogus
• Section: 143(3); 133(6)

Judgement Text

"1 IN THE INCOME TAX APPELLATE TRIBUNAL “DB” BENCH, AMRITSAR VIRTUAL HEARING BEFORE HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM AND SHRI UDAYAN DASGUPTA, JM आयकरअपीलसं. / ITA No.455/ASR/2024 (िनधाŊरणवषŊ / Assessment Year: 2018-19) Income Tax Officer Model Town Road CR Building Jalandhar (Punjab) - 144001 बनाम/ Vs. Shri Nitin Dutta 269, Kalia Colony Jalandhar (Punjab) - 144008 ̾थायीलेखासं./जीआइआरसं./PAN/GIR No. ALDPD-6626-K (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/ Appellant by : None ŮȑथŎकीओरसे/Respondent by : Sh. Farhat Khan (CIT) – Ld. DR सुनवाईकीतारीख/Date of Hearing : 05-02-2026 घोषणाकीतारीख /Date of Pronouncement : 11.02.2026 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by revenue for Assessment Year (AY) 2018-19 arises out of an order of learned Commissioner of Income Tax (Appeals), NFAC dated 18-06-2024 in the matter of an assessment framed by Ld. AO u/s 143(3) on 21-04-2021. At the time of hearing, none appeared for assessee. The perusal of order sheet entries would establish that none is appearing for assessee since past many occasions. Left with no option, we proceed to dispose-off the appeal Printed from counselvise.com 2 after hearing revenue. The Ld. CIT-DR pleaded for full disallowance of alleged bogus purchase as against estimation of 25% as made by Ld. CIT(A) in the impugned order. 2. From case records, it emerges that the assessee’s case was subjected to scrutiny to verify the purchases. Notices u/s 133(6) were issued by Ld. AO to five suppliers which remained non-compliant. The documents as furnished by the assessee were alleged to be fabricated. The assessee could not furnish complete details also. Consequently, Ld. AO disallowed purchased of Rs.60.45 Crores and added the same to the income of the assessee u/s 69C. 3. During first appeal, the assessee stated that it furnished all the required documents to Ld. AO which includes PAN / GST details of suppliers, ledger extracts, assessee’s GST return, audited financial statements etc. The payments to the suppliers were through banking channels. The assessee also furnished month-wise purchase and sales details - both quantity wise and value wise. The quantitative details of opening and closing stock were also furnished. The copies of freight account along with sample vouchers and purchase bills were duly furnished to Ld. AO. The Ld. AO failed to appreciate that the assessee was maintaining complete quantitative records of purchase and sales. The stock as well as sales stood accepted by Ld. AO. The assessee made sales of Rs.79.67 Crores and purchases of Rs.80.45 Crores. All the suppliers filed their respective GST returns. The confirmation of accounts of the 5 suppliers was also furnished. The Printed from counselvise.com 3 financial results for AYs 2016-17 & 2017-18 were accepted in scrutiny assessment proceedings. 4. The Ld. CIT(A), after considering assessee’s submissions as well as remand report, concurred that sale, closing stock and opening stock was not doubted by Ld. AO. Therefore, entire purchase could not be considered as bogus since for effecting sales, there has to be purchase of goods. The assessee furnished confirmed copy of statement of accounts of the suppliers. However, there were many deficiencies in the supporting documents as pointed out by Ld. AO in the remand report. None of the suppliers produced transportation documents. It was clear that AO was not justified in disallowing entire purchases and at the same time, the assessee was not able to substantiate the complete genuineness of the purchases so made. Therefore, the impugned addition was restricted to the extent of 25% against which the revenue is in further appeal before us. It would apparently appear from the record that the assessee has not filed any further appeal. No further appeal is shown to have been filed by the assessee. 5. From the facts, it clearly emerges that the assessee is engaged in trading activities and made sales and purchases for Rs.79.67 Crores & Rs.80.45 Crores respectively. The books of accounts are duly audited as required under law. The assessee has furnished details of opening stock, closing stock and sales. The sales have been accepted by Ld. AO. The assessee as well as the suppliers has filed respective GST returns. The quantity details of sales and purchases Printed from counselvise.com 4 were duly furnished by the assessee before lower authorities. It is quit logical that without purchases, there could not be any sales. The financial results in earlier years stood accepted in scrutiny assessment proceedings. The assessee has duly furnished confirmed copy of accounts before lower authorities. On these facts, the adjudication of Ld. CIT(A) in restricting the impugned addition to the extent of 25% could not be faulted with. We see no reason to interfere in the same. 6. The appeal stands dismissed. Order pronounced u/r 34(4) of Income Tax (Appellate Tribunal) Rules, 1963. -Sd- -Sd- (UDAYAN DAS GUPTA) (MANOJ KUMAR AGGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated:11.02.2026 आदेश की Ůितिलिप अŤेिषत /Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT AMRITSAR Printed from counselvise.com "