ACIT Vs Sikander Daredia (ITAT Hyderabad)
Best-Judgment Addition of ₹14.34 Crore Collapses After Remand Verification — Purchases Proven as Stock-in-Trade; Revenue’s Appeal Dismissed by Hyderabad Tribunal
ACIT Vs Sikander Daredia – ITA No.604/Hyd/2025 – AY 2018-19 – Order dated 12.11.2025
In this Revenue appeal, Tribunal examined an ex-parte best-judgment assessment where the AO treated ₹14.34 crore of land purchases as unexplained investment u/s 69 due to non-compliance by the Assessee during scrutiny. Before CIT(A), the Assessee produced complete books, bank statements, sale-purchase registers, ledger extracts, purchase deeds, audited financials, & payment summaries. All these were forwarded to AO for remand verification.
In the remand report, AO categorically confirmed that (i) payments were made through banking channels, (ii) purchases were recorded under “Fixed Assets” & “Other Current Assets,” (iii) properties were properly accounted as inventory/stock-in-trade, & (iv) ledger extracts, bank statements & documents were consistent & correctly recorded. Based on these findings, CIT(A) deleted the entire addition.
Tribunal noted that the purchases were part of regular real-estate business, duly routed through the P&L account & reflected as “Inventories.” Therefore, u/s 69 addition could not survive once the AO himself confirmed the accounting & sources in remand proceedings. Tribunal also held that Section 56(2)(x) does not apply to stock-in-trade, & in any case it was never part of assessment or first-appeal proceedings, hence Revenue cannot raise it for the first time before Tribunal.
