JAGUAR SHIPPING AND LOGISTICS PRIVATE LIMITED,MUMBAI V. DEPUTY COMMISSIONER OF INCOME TAX 2(2)(1), MUMBAI

ITA 837/MUM/2025

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The case involves Jaguar Shipping and Logistics Private Limited appealing against the order of the Commissioner of Income-tax (Appeals) which upheld the additions made by the Assessing Officer under section 143(3) of the Income-tax Act, 1961. The additions were based on discrepancies found in the purchases made by the assessee when compared with the sales figures provided by the concerned parties. The assessee contended that these discrepancies were due to GST inclusions and timing differences in accounting periods, which were not adequately considered by the CIT(A). The tribunal found that both the Assessing Officer and the CIT(A) did not provide sufficient opportunity for the assessee to reconcile the figures and did not consider the complete details submitted by the assessee.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 315878 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2022-2023
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: KAVITHA KAUSHIK
• Assessee Lawyers: JOSE PULLIKODEN
• Keywords: Corroborative evidences; Unexplained expenditure; FORM 2B
• Section: 143(3); 133(6); 69C

Judgement Text

"IN THE INCOME-TAX APPELLATE TRIBUNAL “F” BENCH, MUMBAI BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER & SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER ITA 837/MUM/2025 (A.Y. 2022-23) Jaguar Shipping and Logistics Private Limited, Unit No. 610, Meadows Sahar Plaza, JB Nagar, Andheri East, Mumbai -400059, Maharashtra v/s. बनाम Deputy Commissioner of Income Tax 2(2)(1), Aayakar Bhavan, New Marine Lines, Mumbai – 400 021, Maharashtra स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AABCJ4148G Appellant/अपीलार्थी .. Respondent/प्रतिवादी Appellant by : Shri Jose Pullikoden, AR Respondent by : Ms. Kavitha Kaushik (Sr. DR) Date of Hearing 05.05.2025 Date of Pronouncement 14.05.2025 आदेश / O R D E R PER PRABHASH SHANKAR [A.M.] :- The present appeal arising from the appellate order dated 19.12.2024 is filed by the assessee against the order passed by the Learned Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre, Delhi [hereinafter referred to as “CIT(A)”] pertaining to assessment order passed u/s. 143(3) of the Income-tax Act, 1961 [hereinafter referred to as “Act”] dated 08.03.2024 for the Assessment Year [A.Y.] 2022-23. P a g e | 2 ITA No. 837/Mum/2025 A.Y. 2022-23 Jaguar Shipping and Logistics Pvt. Ltd. 2. In various grounds of appeal, the assessee has contented that the CIT(A) erred in misinterpreting the working of reconciliation with M/s Aqua Trade Global Logistics Pvt Ltd, M/s Baron Shipping & Logistics Pvt Ltd. & M/s Wan Hai Lines Limited. He erred in understanding the reconciliation of the party Aqua Trade Global Logistics Pvt Ltd and also erred in understanding that the difference of Rs. 17,60,131/- was account of GST being included in the ledger given by the party. He erred to accept the confirmation filed by the Aqua Trade Global Logistics, showing this difference as GST received and included in the total. The CIT(A) erred to take into the account the GSTR 2B showing the purchases which include the details M/s Aqua Trade Global Logistics.The CIT(A) erred in not considering the reconciliation of the party M/s Baron Shipping & Logistics Pvt Ltd. given during the Assessment proceedings and also erred in not considering the Ledger confirmations given during the Assessment proceedings. The CIT(A) erred in not considering the reconciliation of the party M/s Wan Hai Lines Limited given during the Assessment proceedings and also erred in not considering the ledger and copies of invoices given during the Assessment proceedings by the Appellant. The CIT(A) erred in not taking into consideration the working of reconciliation and how the same has led to the difference of Rs. 91,488/- with the ledger A/c of the party M/s Wan Hai Lines Limited. 3. The assessee is engaged in business of freight and forwarding by air, sea, land and is specialized in handling of cargo, P a g e | 3 ITA No. 837/Mum/2025 A.Y. 2022-23 Jaguar Shipping and Logistics Pvt. Ltd. documentation services and other ancillary logistic/clearing services. Its major business is freight and logistic services. In the assessment order, three additions were made, based on the differences found in the purchases made by the assessee when these figures were compared with the replies of the parties concerned obtained by the ld.AO u/s 133(6) of the Act. The details of additions made are as under: i. Aqua Traders Global Logistics Rs. 17,60,131/- ii. Baron Shipping Logistics Rs. 21,000/- iii. Wan Hi Lines Ltd. Rs. 91,488/- TOTAL Rs. 18,72,619/- 4. It is noticed from the assessment order that in respect of AQUA TRADERS GLOBAL LOGISTICS, it was noticed by the AO that the assessee had purchase made during the year of Rs.1,45,00,636/- ( Rs.9,14,980-1,54,15,616/-) but the said party had sold to the assesse of Rs.1,27,40,505/-. So, there was difference of Rs.17,60,131/-. He observed that the assessee failed to reconcile and also did not file any explanation in this regard. Hence, the amount of Rs. 17,60,131/- was added to the income of the assessee as unexplained expenditure which was not considered in the books of accounts. P a g e | 4 ITA No. 837/Mum/2025 A.Y. 2022-23 Jaguar Shipping and Logistics Pvt. Ltd. 4.1 In the case of BARON SHIPING LOGISTICS, the AO noticed that the said party had shown sales to the assessee company during the year of Rs.14,65,750/- whereas it had shown purchase from that party of Rs.14,44,750/-. In view of this, the difference of Rs.21,000/- was considered as transaction out in the books of accounts and was added to the income of the assessee as unexplained expenditure. 4.2 In the case of WAN HI LINES LIMITED, it was noticed by him that the above party had shown sales made to the assessee during the year of Rs.6,83,280/- whereas it disclosed purchase from them of Rs.5,91,792/-. In view of this, the difference of Rs.91,488/- being excess transactions was added to the income of the assessee as unexplained expenditure which was not considered in the books of accounts. 5. In the subsequent appeal by the assessee before the ld.CIT(A), so far as the difference in the case of Aqua Traders Global Logistics is concerned, it was submitted by the assessee that the difference of Rs. 17,60,131/- was the GST amount which was included in the sales, by this party, but in their account this amount was excluding the GST. So far as Baron Sipping Logistics of Rs. 21,000/- and Wan Hi Lines Ltd. of Rs. 91,488/-are concerned, it was submitted that the assessee was not aware P a g e | 5 ITA No. 837/Mum/2025 A.Y. 2022-23 Jaguar Shipping and Logistics Pvt. Ltd. of the how there was such a difference and since both these parties being foreign shipping lines were non cooperative and did not provide any clarification. The assessee had filed the copy of the confirmation from Aqua Traders Global Logistics. The ld.CIT(A) further observed that in support of the claim, the assessee neither filed the copy of the ledger account nor the Form 2B of GST whereby the details of GST against the said party could be verified. So far as other two parties are concerned, he stated that the appellant expressed its inability to furnish any reconciliation. Accordingly, all the above additions made by the AO aggregating to Rs. 18,72,619/-was upheld by him 6. During the hearing before us, the ld.DR has supported the additions made and upheld by the authorities below. Per contra the ld.AR has argued against the disallowance in oral and also written submissions made. In respect of transaction with Aqua Traders, it is submitted that the difference of Rs. 17,60,131/-was the GST paid by the assessee on this transaction of purchases and the ledger account of this party showed the ledger with GST, whereas the its ledger is without GST. This amount is also reflected in the GSTR 2B return filed by the assessee which vindicates its stand. Both the authorities failed to take this explanation into account as the assessee admittedly did not furnish the GSTR returns during the P a g e | 6 ITA No. 837/Mum/2025 A.Y. 2022-23 Jaguar Shipping and Logistics Pvt. Ltd. appellate proceedings (being voluminous). But the CIT(A)'s passed the order without allowing us any further opportunity. 6.1 In respect of transactions with Baron Shipping Logistics, it is submitted that there is a minor difference of Rs. 21,000/- which is on account of the fact that assessee has taken this invoice amount in the subsequent year and the same is reflected in its books of account in A.Y.2023-24 and not A.Y.2022-23. This was explained during the assessment proceedings and also in the statement of facts before the appellate authority, but was not taken into cognizance and the difference was added and confirmed by CIT(A). The ledger of both the years along with the signed copy of the confirmation, and copy of invoices were submitted at the time of assessment proceedings which was totally ignored by the CIT(A). Further, if given the chance, it could have furnished the copy of GSTR-2B reflecting the name of the party in both the years. 6.2 In respect of transaction with Wan Hi Lines Limited, it is contented that there is a difference of Rs. 91,488/- which is on account of discount of Rs. 53,940/- given the assessee by the party. Its ledger clearly shows the debit notes issued by the party and the assessee has P a g e | 7 ITA No. 837/Mum/2025 A.Y. 2022-23 Jaguar Shipping and Logistics Pvt. Ltd. made the payment after availing this discount given by this party. The party has not taken into account these debit notes raised by them in their ledger account. Further the Appellant had made payment to this party’s sister concern of i.e M/s Wan Hai Lines (India) Pvt. Ltd. of Rs.8132/- & Rs.4307/- and which it reduced from the ledger but the party had not reduced it but has included it in Wan Hi Lines Limited instead of including it in the ledger of M/s Wan Hai Lines (India) Pvt. Ltd. Also the last difference of balance amount of Rs.25,109/- in on account of GST which included in their ledger but not included in its Ledger. The Assessing Officer as well as CIT(A) failed to accept this reconciliation and the working and also failed to take into account the signed confirmation given by this party. 6.3 It is further contented that the assessee also objects to the additions made under the head “Purchases” of these above mentioned parties as unexplained expenditure u/s 69C of the Act. To bring these purchases under the ambit of unexplained purchases, the payments should not have been recorded in the books of account and of the assessee offers no proper explanation on the difference in the amount. But these conditions have been fulfilled by it. The differences / discrepancies were explained during the assessment proceedings and P a g e | 8 ITA No. 837/Mum/2025 A.Y. 2022-23 Jaguar Shipping and Logistics Pvt. Ltd. proof of the same was furnished but the AO as well as before CIT(A) did not consider the same in right perspective. 7. We have carefully considered the facts of the case as culled from the records and also the contentions and the submissions made by the assessee. It appears that in the present case, neither the AO nor the ld.CIT(A) have accorded adequate opportunity to the assessee to reconcile the figures possibly by considering incomplete details submitted by the assessee and in rushing to draw adverse view of the matter. On the other hand, even the assessee has admittedly not submitted complete reply and supporting evidences including GST records relating to the impugned transactions. 7.1 In view of above, we consider it appropriate to remand the issue back to the file of the ld.CIT(A) for de novo consideration of the all the material facts and the evidences i.e GSTR-2B and other evidences so as to reach a just and fair conclusion on the whole issue which merely involves reconciliation of facts and figures only. Therefore, following the principles of justice and fair play, we direct the ld.CIT(A) to allow adequate opportunity of hearing to the assessee in this regard and decide the matter in accordance with the provisions of law. P a g e | 9 ITA No. 837/Mum/2025 A.Y. 2022-23 Jaguar Shipping and Logistics Pvt. Ltd. 8. In the result, the appeal is allowed for statistical purposes. Order pronounced in the open court on 14/05/2025. Sd/- Sd/- AMIT SHUKLA PRABHASH SHANKAR (न्याययक सदस्य /JUDICIAL MEMBER) (लेखाकार सदस्य/ACCOUNTANT MEMBER) Place: म ुंबई/Mumbai ददनाुंक /Date 14.05.2025 Lubhna Shaikh / Steno आदेश की प्रयियलयि अग्रेयिि/Copy of the Order forwarded to : 1. अपीलार्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. सत्यावपि प्रवि //True Copy// आदेशानुसार/ BY ORDER, उि/सहायक िंजीकार (Dy./Asstt. Registrar) आयकर अिीलीय अयिकरण/ ITAT, Bench, Mumbai. "