PCIT Vs Hareshkumar Manilal Somaiya (Gujarat High Court)
Summary: The Gujarat High Court dismissed the Revenue’s appeal under section 260A of the Income Tax Act, concerning deletion of an addition of Rs. 11,69,50,000 made under section 68 of the Income Tax Act, 1961 on account of unsecured loans.
The assessee was proprietor of M/s. Rohit Trading Co., engaged in trading of grains and other food items. For AY 2012-13, the assessee filed his return on 29.09.2012 declaring total income of Rs. 7,05,650/-. The return was selected for scrutiny and notice under section 143(2) was issued on 22.8.2013, followed by notice under section 142(1). According to the department, the assessee did not produce the books of accounts. Consequently, assessment was completed on 17.3.2015 under section 143(3) read with section 144, determining total income at Rs. 23,01,11,530/-.
Before the Commissioner of Income Tax (Appeals), the assessee challenged the assessment. The appellate Commissioner partly allowed the appeal on 28.3.2017. In relation to the addition of Rs. 11,74,50,000 under section 68, the Commissioner deleted Rs. 11,69,50,000 and confirmed Rs. 5,00,000. The Commissioner also deleted Rs. 9,55,33,843 out of the disallowance of Rs. 9,56,33,843 relating to purchases and sustained Rs. 1,00,000.
The Revenue appealed to the Income Tax Appellate Tribunal, which dismissed the appeal. The Revenue therefore approached the High Court under section 260A.
