Atul Agarwal Ltd vs ITO

Parties Involved

Facts Summary

The assessee, Atul Agarwal Ltd, filed a return of income for the year under consideration showing a gross turnover of Rs 15,76,500/- by declaring income of Rs. 4,72,950/- u/s 44AD of the Income-tax Act, 1961. Based on information received from the Investigation wing during a search and seizure operation in the case of Alankrit group, evidence was recovered indicating that the assessee had received unaccounted cash of Rs 1,60,11,223/- and made an accommodation entry from a shell entity controlled by Alok Kumar Agarwal. Consequently, the case was reopened u/s 148 after taking prior permission from the competent authority. The Assessing Officer completed the assessment u/s 147 r.w.s. 144B of the Act by assessing the total income at Rs. 1,63,59,143/- thereby raising a tax demand of Rs. 2,00,42,641/-. Aggrieved by this, the assessee appealed before the ld. CIT(A), who upheld the assessment order. The assessee further appealed to the Tribunal.…

Legal Issues

• 1. Whether the assessment made u/s 153A was valid.
• 2. Whether the addition of Rs. 1,60,11,223/- as unexplained income was justified.
• 3. Whether the Assessing Officer erred in making an addition of hypothetical income.
• 4. Whether the Assessing Officer followed the instructions of the CBDT Circulars.
• 5. Whether the Assessing Officer justified the addition of Rs. 1,60,11,223/- in the absence of bank account reflections.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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