ACIT Vs Freightbridge Logistics Pvt. Ltd. (ITAT Mumbai)
Ad-Hoc Profit @8% on Logistics Turnover Rejected – Non-Resident Shipping Vendors Not Ground to Reject Books – ₹19.09 Cr Addition Deleted – ITAT Mumbai
AO rejected books & estimated NP @8% on turnover of ₹353.68 Cr alleging discrepancies in trade creditors and non-filing/ nil ITRs by foreign shipping vendors, resulting in addition of ₹19.09 Cr. CIT(A) deleted addition after calling remand report and issuing notices u/s 133(6) to major vendors.
ITAT held that confirmations from substantial creditors, bank trail, ledger accounts and industry-consistent profit ratios established genuineness of transactions. Tribunal observed that main vendors were non-resident shipping lines governed by special taxation provisions and filing nil returns in India cannot justify rejection of books. Ad-hoc estimation without comparable cases or incriminating material was held arbitrary. Since CIT(A) conducted independent verification and AO had opportunity during remand, objection under Rule 46A failed. Deletion of addition upheld and Revenue appeal dismissed
FULL TEXT OF THE ORDER OF ITAT MUMBAI
The instant appeal of the revenue filed against the order of the NFAC, Delhi [for brevity ‘the Ld. CIT(A)], order passed under section 250 of the Income Tax Act 1961 (for brevity ‘the Act’) for Assessment Year 2022-23, date of order 11.09.2025. The impugned order emanated from the order of the Ld. Assessment Unit Income Tax Department (for brevity the ‘Ld. AO’) order passed under section 143(3) r.w.s. 144B of the Act date of order 28.03.2024.
