JPS Buildtech Pvt Ltd Vs DCIT (ITAT Delhi)
Tribunal dealt with four cross-appeals arising from search-linked assessments u/s 153C in the case of JPS Buildtech Pvt Ltd following seizure of incriminating tally data from Sanjay Jain—an admitted accommodation entry operator. The jurisdictional objection was rejected as seized ledgers & tally records clearly pertained to Assessee & established nexus with undisclosed transactions, satisfying the requirement of valid satisfaction u/s 153C.
On merits, AO treated entire purchases from entities linked to Sanjay Jain as bogus, disallowing ₹1.63 crore for AY 2019-20 & ₹4.98 crore for AY 2020-21. CIT(A) accepted that purchases were routed through entry operators but also held that consumption & sales were undisputed, and therefore estimated profit element at 20%. Tribunal upheld the approach but held that 15% of disputed purchases would be a more reasonable embedded profit, considering GP/NP history & factual matrix. Consequently, additions were restricted to 15% for both years.
Revenue’s appeal for AY 2019-20 was dismissed as tax effect was below CBDT’s threshold of ₹60 lakh, & the appeal for AY 2020-21 was dismissed following parity of facts. Assessee’s appeals for both years were partly allowed to the extent of reducing addition from 20% to 15%.
