ITA Nos.3997 & 4350/Del/2024 (AY 2018-19)

Parties Involved

Facts Summary

The cross appeals by the Revenue and assessee are directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi (hereinafter referred to as 'the CIT(A)') dated 12.07.2024, for assessment year 2018-19. The assessee's appeal was initially time-barred by 10 days, but the delay was condoned after the assessee's counsel provided a bonafide reason for the delay. The assessment order added Rs.2,79,13,467/- under section 69C of the Income Tax Act, 1961, due to alleged bogus purchases by the assessee. The assessee failed to respond to multiple notices issued under section 142(1) and 148 of the Act. The CIT(A) upheld the validity of the notice under section 148 but restricted the addition to 12.5% of the total alleged bogus purchases. Both parties are now in appeal before the Tribunal. The assessee is a trader in yarn and the assessment was reopened based on information flagged by the CBDT through ITBA software. The assessee submitted various documents to substantiate the purchases, leading the CIT(A) to restrict the addition to 12.5%.…

Legal Issues

• 1. Validity of the notice issued under section 148 of the Income Tax Act, 1961
• 2. Merits of the addition made under section 69C of the Income Tax Act, 1961

Judgment Outcome

Decided in favour of Assessee.

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