Lava International Ltd. vs Assessment Unit

Parties Involved

Facts Summary

The assessee company, Lava International Ltd., is engaged in the business of manufacturing and trading of mobile phones under the brand name 'LAVA'. The company filed its return of income for INR 1,24,57,90,880/-. The case was selected for scrutiny under CASS. During the assessment proceedings, the Assessing Officer (AO) disallowed 5% of the total transaction made with M/s. Gryfon Commodities, amounting to INR 3,11,07,987/-, due to the cancellation of the supplier's GST registration from July 2021. The Commissioner of Income Tax (Appeals) confirmed this disallowance, leading the assessee to file an appeal before the Tribunal.…

Legal Issues

• 1. Validity of the assessment order under section 144 read with section 144B of the Act.
• 2. Violation of principles of natural justice in passing the assessment order.
• 3. Disallowance of Rs.3,11,07,987 being 5% of purchases made from Gryfon.
• 4. Interest under section 234C of the Act.

Judgment Outcome

Decided in favour of Assessee.

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