Deputy Commissioner of Income Tax vs. Priti Construction Tirupathi Construction Corporation Joint Venture

Parties Involved

Facts Summary

The assessee, Priti Construction Tirupathi Construction Corporation Joint Venture, is engaged in civil contract work such as road constructions and repairs. The assessee filed its return of income for A.Y. 2011-12 on 30.09.2011 declaring a total income of Rs. 1,32,69,756/-. The Assessing Officer completed the assessment u/s 143(3) r.w.s. 254 and made additions of Rs. 1,56,20,670/- being 100% of alleged bogus purchases, and Rs. 6,24,827/- being 4% of such purchases, alleging undue VAT credit. Thus, a total addition of Rs. 1,62,45,497/- was made, and the assessed income was determined at Rs. 2,95,15,250/-. On appeal, the Ld. CIT(A) granted relief by restricting the addition on account of alleged bogus purchases to 7% and deleting the VAT addition of Rs. 6,24,827/-. Aggrieved by this, the Revenue filed an appeal before the Tribunal.…

Legal Issues

• 1. Whether the CIT(A) erred in restricting addition to Rs. 10,93,446/- being 7% of alleged bogus purchases as against 100% disallowance made by AO.
• 2. Whether the CIT(A) erred in restricting addition @7% ignoring the decision of Hon’ble Supreme Court in N.K. Proteins Ltd.
• 3. Whether the CIT(A) erred in deleting addition of Rs. 6,24,827/- on account of undue VAT credit without giving reasons.
• 4. Whether the CIT(A) erred in granting relief even though the assessee allegedly failed to prove utilization/consumption of material for execution of contracts.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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