Nirmala Mobile Net Services Pvt. Ltd. vs. ITO

Parties Involved

Facts Summary

The assessee, Nirmala Mobile Net Services Pvt. Ltd., is engaged in the business of wholesale trading in cigarettes. The Assessing Officer (AO) noted discrepancies in the purchases reported by the assessee and those reported by M/s ITC Limited. The AO issued a show cause notice under section 148A(b) of the Income-tax Act, 1961, alleging undisclosed purchases. The assessee filed a return of income under section 139(1) of the Act, declaring total income of Rs.14,48,220/-. The AO re-opened the case under section 147 of the Act and passed an ex parte order adding undisclosed purchases of Rs.14,43,15,208/-. The assessee appealed to the Commissioner of Income Tax (Appeals), who sustained the addition. The assessee further appealed to the Income Tax Appellate Tribunal (ITAT).…

Legal Issues

• 1. Addition made by the AO under section 69C of the Act for undisclosed purchases.
• 2. Confirmation of addition of Rs.52,608/- being 8% of contractual receipts.
• 3. Addition of Rs.57,81,04,460/- by the AO as unexplained cash credit under section 68 of the Act.
• 4. Confirmation of addition of Rs.2,390/- by the CIT(A), being interest income.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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