ACIT Vs Archean Chemical Industries Ltd (ITAT Chennai)
In ACIT Vs Archean Chemical Industries Ltd, the Chennai ITAT considered the Revenue’s appeal against the order of the Commissioner of Income Tax (Appeals) deleting an addition of Rs. 51.81 crore made under Section 69C of the Income Tax Act for Assessment Year 2022-23. The Assessing Officer had treated the difference between import data reflected in the Income Tax Department’s Insight Portal and Form GSTR-2A as unexplained expenditure.
The assessee, a public limited company engaged in manufacturing industrial salt, bromine, and other industrial chemicals, had filed its return declaring nil income after set-off of brought forward losses. During assessment proceedings under Sections 143(3) read with 144B, the Assessing Officer concluded that the difference in import figures represented unaccounted imports or purchases and added the amount under Section 69C.
The Revenue argued before the Tribunal that the CIT(A) wrongly deleted the addition without properly appreciating the facts and contended that the assessee failed to reconcile the import data with documentary evidence. It also argued that the CIT(A) accepted the assessee’s explanation regarding returnable empty ISO containers without verifying their accounting treatment or impact on computation of income. The Revenue further submitted that the assessment order was not violative of natural justice since show-cause notices had been issued and replies considered.
