Sh. Harvinder Singh Through Legal Heir Smt. Gulraj Kaur vs. ITO, Ward -6 (1), Pathankot

Parties Involved

Facts Summary

The assessee, engaged in the business of manufacturing Zinc, Zinc Oxide & Silver, was assessed for the Assessment Year 2015-16. The Assessing Officer (AO) made an addition of Rs.16,71,782/- on account of unconfirmed sundry creditors. The assessee filed an appeal against this addition before the Commissioner of Income Tax (Appeals) (CIT(A)), which was dismissed. The assessee then appealed to the Income Tax Appellate Tribunal (ITAT). The assessee argued that the addition was arbitrary and unjustified as the purchases from these creditors were accepted by the AO, and payments were made through banking channels. The assessee also argued that the addition should be deleted as the creditors' balances were carried forward to the next year and payments were made through bank channels.…

Legal Issues

• 1. Whether the Ld. Commissioner of Income Tax(Appeals) erred in upholding the addition of Rs.16,71,782/- made on account of alleged unconfirmed creditors?
• 2. Whether the Commissioner of Income Tax(Appeals) sustained the addition without appreciating the explanations and factual position?

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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