Aggarwal Construction Company vs. DCIT, Circle-I, Bathinda

Parties Involved

Facts Summary

The regular assessment for the Assessment Year 2012-13 was framed under section 143(3) of the Income Tax Act, 1961, at an income of Rs. 37,67,220/- with certain additions on account of gross profit amounting to Rs. 23,50,207/-. Information from the ADIT Investigation indicated that the assessee had made bogus purchases amounting to Rs. 9,19,04,587/- from M/s Hitesh Industries and M/s Akansha Enterprises, which escaped assessment. A notice under section 148 was issued, and the assessee failed to respond, leading to reassessment proceedings. The assessee appealed to the CIT(A), challenging the reopening of the case and the addition on account of the alleged bogus purchases. The CIT(A) restricted the addition to 25% of the bogus purchases from M/s Akansha Enterprises, amounting to Rs. 5,60,33,277/-. Both the assessee and the Department appealed to the ITAT, leading to the current proceedings.…

Legal Issues

• 1. Whether the issuance of notice under section 148 was beyond the limitation period and without jurisdiction?
• 2. Whether the addition on account of alleged bogus purchases was justified?

Judgment Outcome

Decided in favour of Partly Assessee / Partly Revenue.

Precedents Relied Upon

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