RAKS TRADE LOGISTICS PVT. LTD.,NEW DELHI V. DCIT, CIRCLE- 19(1), DELHI

ITA 3710/DEL/2024

AI Insights

The case involves RAKS Trade Logistics Pvt. Ltd., which appealed against an assessment order that added INR 22,09,92,244 as bogus purchases under section 69C of the Income Tax Act, 1961. The appeal was initially adjudicated ex-parte by the CIT(A), who issued multiple notices to the assessee, but due to a search and seizure operation by the Directorate of Revenue Intelligence, the assessee could not respond adequately. The Tribunal found merit in the assessee's plea that the ex-parte order was unjust due to the circumstances preventing their appearance and thus set aside the CIT(A)'s order, remanding the case for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 470448 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2021-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL YADAV
• Assessee Lawyers: VIJAY KUMAR SINGLA
• Keywords: Set aside; Reasonable cause; Bogus purchase; Bogus
• Section: 143(3); 250; 69C

Judgement Text

"ITA No.3710/Del/2024 Page | 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “F” BENCH: NEW DELHI BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI SUDHIR KUMAR, JUDICIAL MEMBER ITA No.3710/Del/2024 [Assessment Year : 2021-22] RAKS Trade Logistics Pvt.Ltd. RAR Plot No.51, Office No.309A Block-B, Janakpuri, South West Delhi, Delhi-110058 PAN-AAKCR1306H vs DCIT Circle-19(1) Delhi APPELLANT RESPONDENT Appellant by Shri Vijay Kumar Singla, CA Respondent by Shri Sunil Yadav, CIT DR Date of Hearing 06.03.2025 Date of Pronouncement 06.03.2025 ORDER PER PRADIP KUMAR KEDIA, AM : The instant appeal has been filed at the instance of the assessee seeking to assail the First Appellate order dated 03.07.2024 passed by Commissioner of Income Tax (A), National Faceless Appeal Centre (“NFAC”), Delhi [“CIT(A)”] under s. 250 of the Income Tax Act, 1961 [“the Act”] arising from the assessment order dated 22.12.2022 under s. 143(3) r.w.s 144B of the Act pertaining to assessment year 2021-22. 2. When the matter was called for hearing, the Ld. Counsel for the assessee submitted at the outset that the appeal filed by the assessee arises from ex- parte order of the CIT(A). The AO in the instant case has made an addition of INR 22,09,92,244/- under s. 69C of the Income Tax Act, 1961 (“the Act’) towards bogus purchases. 3. The assessee filed appeal before the CIT(A) against the aforesaid assessment order. The CIT(A) issued 04 notices one after another within the span of 29 days. Four notices were issued on 20.50.2024; 04.06.2024; 12.06.2024 and 19.06.2024. The assessee, on one occasion, has also filed ITA No.3710/Del/2024 Page | 2 adjournment letter. The CIT(A) ultimately adjudicated the issue against the assessee in a hurried manner without giving reasonable opportunity to the assessee. The Ld. Counsel further added that the assessee was prevented by prima-facie reasonable cause from attending the proceedings before the CIT(A). The Ld. Counsel adverted to the documentary evidences and submitted that there was a search action on the assessee by the Office of Directorate of Revenue Intelligence (“DRI’) on 03.01.2023 wherein the books of accounts and other relevant documents were seized by the authorities. The assessee was thus in no position to comply with notices issued before the CIT(A) to support the returned income and to negate the allegations towards bogus purchases labeled by the AO in the assessment order. The documents have recently been released somewhere in January, 2025 and thus the default for non-appearance before the CIT(A) cannot be attributed to any willful negligent on the part of the assessee. The Ld. Counsel urged for setting aside the ex-parte order of the CIT(A) and restore the matter to the file of the CIT(A) for fresh adjudication of appeal after giving proper opportunity to the assessee. 4. We have perused the case records. We find prima-facie justification in the plea of the assessee for setting aside the first appellate order and for restoration of the appeal for fresh adjudication in accordance with law after giving proper opportunity in the light of circumstances narrated on behalf of the assessee. The first appellate order is thus set aside and the appeal filed before the CIT(A) stands revived for fresh adjudication in accordance with law by the CIT(A) after giving reasonable opportunity to the assessee. 5. In the result, the appeal of the assessee is allowed for statistical purposes. Order dictated and pronounced in the open Court on 06.03.2025. Sd/- Sd/- (SUDHIR KUMAR) JUDICIAL MEMBER *Amit Kumar, Sr.P.S* (PRADIP KUMAR KEDIA) ACCOUNTANT MEMBER ITA No.3710/Del/2024 Page | 3 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "