Savitri Jain Vs ITO (ITAT Delhi)
Assessee, proprietor of M/s M J Paper India, filed appeal against order of CIT(A) arising from reassessment u/s 147, wherein AO had made addition of Rs.76,10,580/- u/s 69C treating purchases from M/s Jai Bhagwani Sales as bogus.
CIT(A) partly allowed appeal by estimating GP @ 12.5% on alleged purchases & restricted addition to Rs.9,51,322/-.
Before Tribunal, Assessee argued that only Rs.30,42,821/- worth of purchases were actually made from Jai Bhagwani Sales during FY 2017-18, duly recorded in books & supported by bills & bank statements. The figure of Rs.76,10,580/- was wrongly reported by seller in GST returns. Since sales were never doubted, purchases could not be held bogus. It was contended that even CIT(A) erred in estimating profits at 12.5% without basis.
Tribunal observed that AO relied solely on third-party GST data without verifying Assessee’s records. Ledger account confirmed actual purchases of Rs.30,42,821/-. It held that wrong reporting by supplier could not justify entire disallowance. Considering facts, it modified CIT(A)’s order & directed AO to apply GP @ 5% on admitted purchases of Rs.30,42,821/-. Accordingly, appeal was partly allowed with relief to Assessee
FULL TEXT OF THE ORDER OF ITAT DELHI
The present appeal is filed by the Assessee against the order of Ld. Commissioner of Income Tax (Appeals/ National Faceless Appeal Centre (‘Ld. CIT(A)/NFAC’ for short), New Delhi dated 10/02/2025 pertaining to Assessment Year 2018-19.
