Aerotech Enterprise vs. ITO

Parties Involved

Facts Summary

The case involves an appeal by Aerotech Enterprise against the order of the National Faceless Appeal Centre (NFAC), Delhi, for the Assessment Year 2018-19. The assessee had filed a return of income declaring a total income of Rs.16,84,211/-. The case was selected for complete scrutiny due to low net profit shown by the construction contractor and a claim of a large refund. The Assessing Officer (AO) found that the assessee had claimed huge expenses under purchases, job work payment, and petrol expenses. The AO also found that transport expenses amounting to Rs.75,77,863/- were claimed as a deduction. The AO called for ledger accounts, bills, and vouchers to verify the transport expenses, but the assessee produced ledger accounts for only 3 parties to whom a total payment of Rs.29,68,838/- was made. The AO required the assessee to produce ledger accounts and bills for expenditures of Rs.2 Lakhs or more, which was not fully complied with. Consequently, the AO disallowed the transport expenses of Rs.36,33,945/-, which were not supported by any bills or vouchers. The assessment was completed under section 143(3) of the Act on 22/03/2021. The assessee filed an appeal before the First Appellate Authority, which was decided in favor of the AO. The assessee then filed a second appeal before the Income Tax Appellate Tribunal.…

Legal Issues

• 1. Disallowance of transport expenses of Rs.36,33,945/- by the AO
• 2. Confirmation of addition by the Ld. CIT(A)
• 3. Calculation of tax under section 115BBE

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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