Garg Acrylics Ltd Vs. DCIT

Parties Involved

Facts Summary

The appeal in ITA No.2562/Del/2023 for AY 2011-12, arises out of the order of the Commissioner of Income Tax (Appeals)-5, Ludhiana dated 04.01.2019 against the order of assessment passed by the Assessing Officer, JCIT, Special Range-4, New Delhi dated 30.11.2018. The assessee company filed its original return of income for the Asst Year 2011-12 declaring total income of Rs 31,41,11,875/-. The assessment order was passed determining total income at Rs 4041,39,341/-. The additions made in this assessment were deleted by the ld. CIT(A) in first round of proceedings. The revenue preferred second appeal before this Tribunal. The Tribunal upheld the order of the ld. CIT(A) vide order in ITA No. 6834/Del/2014 dated 27.10.2020. Later the assessment was sought to be reopened vide issuance of notice u/s 148 of the Act on 17.3.2017 after recording of reasons based on the information received from the investigation wing of the department on the ground that the assessee had made bogus purchases from M/s Shiva Stores and M/s Shree Bajrang Foods. The assessee submitted all the requisite details from time to time in the reassessment proceedings. The ld. AO made disallowance of Rs 66,63,086/- being 20% of Rs 3,33,15,432/-, being the purchases made from M/s Shiva Stores and M/s Shree Bajrang Foods. Both these concerns belong to Shri Ram Prakash Bhatia. A statement was recorded by the investigation wing from Shri Ram Prakash Bhatia and based on this statement, the addition at the rate of 20% of…

Legal Issues

• 1. Whether the ld. CIT(A) was justified in enhancing the addition to Rs 1,62,13,633/- as against Rs 32,42,726/- made by the ld. AO on account of alleged bogus purchases u/s 69C of the Act in the facts and circumstances of the case.

Judgment Outcome

Decided in favour of Assessee.

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