HC directs CIT to reconsider assessment to redetermine gross profit applicable to unexplained purchases

Sonu Malik Vs Assessing Officer (Delhi High Court)

Delhi High Court directed Commissioner of Income Tax (CIT) to re-consider the high-pitched assessment as gross profit applied is 12.5% as against historical gross profit of 1.06%. Coercive measures against the petitioner instructed to be kept on hold.

Facts- This writ petition is directed against the order dated 23.12.2022 passed by the Assessing Officer (AO) under Section 220(6) of the Income Tax Act 1961 [in short “Act”] concerning Assessment Year (AY) 2020-2021.

The impugned order was passed, based on applications dated 11.2022 and 05.12.2022 filed by the petitioner, to stay the demand amounting to Rs.7,43,46,066/-.

The petitioner had asked for stay of demand, and waiver of 20% of the demand. Via the impugned order, the AO has scaled down the demand, pending the adjudication of the appeal preferred by the petitioner with the Commissioner of Income Tax (Appeals) [in short “CIT(A)”] to 20% of the aforementioned demand.

Please become a Premium member. If you are already a Premium member, login here to access the full content.