Case Law Details
Maa Chandi Rice Industries Vs ACIT (ITAT Raipur)
The Raipur Bench of the Income Tax Appellate Tribunal (ITAT) dealt with appeals filed by the assessee against orders passed by the Commissioner of Income Tax (Appeals), Raipur-3 dated 24.12.2025 for assessment years 2015-16 and 2016-17.
At the time of hearing, none appeared on behalf of the assessee, though an adjournment application had been filed. The Tribunal rejected the adjournment request and proceeded to hear the matter after considering the submissions of the Senior Departmental Representative and examining the material available on record.
The Revenue submitted that the dispute related to alleged bogus purchases by rice millers, an issue already pending before the jurisdictional High Court in several matters. The Tribunal treated the appeal for AY 2015-16 as the lead matter.
For AY 2015-16, the assessee had filed its return declaring total income of Rs.8,21,840. The assessment was originally completed under Section 143(3) on 14.07.2017 determining total income at Rs.19,66,360. Subsequently, based on information received from the Investigation Wing, Raipur, the case was reopened under Section 147 after approval under Section 151. The information indicated that the assessee was allegedly a beneficiary of accommodation entries in the form of bogus purchases from two concerns, namely M/s Shri Vaishno Devi Exim amounting to Rs.51,08,750 and M/s Maa Sharda Process amounting to Rs.30,00,000, aggregating to Rs.81,08,750. The proprietors of these concerns had reportedly admitted before the Investigation Wing that their entities were engaged only in issuing bogus purchase bills and that amounts received from beneficiaries were returned in cash after routing through bank accounts.
During reassessment proceedings, the assessee allegedly failed to produce documentary evidence regarding actual movement of goods from suppliers to the assessee and from the assessee to customers. Consequently, the Assessing Officer treated the purchases of Rs.81,08,750 as unexplained expenditure under Section 69C and assessed total income at Rs.1,00,75,110.
The Senior Departmental Representative informed the Tribunal that the issue relating to alleged bogus purchase bills by rice millers was pending adjudication before the jurisdictional High Court in several appeals, including matters involving Keshari Rice Industries, Kishore Kumar Panjwani, Arvind Kumar Agrawal, Sandeep Agrawal, Sudhir Kumar Bansal and Gurunanak Rice Industries.
The Tribunal further referred to its earlier decisions in Gindlani Rice Mill and Vinod Kumar Agrawal. In those cases, the Tribunal had observed that since the issue concerning procurement of bogus purchase bills by rice millers was already sub-judice before the jurisdictional High Court, it would not be appropriate for the Tribunal to adjudicate the matter finally at that stage. The Tribunal had also held that keeping such matters pending before it would not serve any logical purpose. Accordingly, in those earlier cases, the matters were restored to the file of the CIT(A)/NFAC with directions to await the outcome of the proceedings before the jurisdictional High Court and thereafter adjudicate the issues afresh in accordance with law and principles of natural justice.
Relying upon the earlier judicial pronouncements and following the principle of consistency, the Tribunal set aside the order of the CIT(A) for AY 2015-16 and remanded the matter back to the first appellate authority with similar directions. The appeal for AY 2015-16 was therefore allowed for statistical purposes.
For AY 2016-17, the Tribunal observed that the facts and issues were identical to those involved in AY 2015-16. Accordingly, the Tribunal applied the same reasoning and directions mutatis mutandis to the appeal for AY 2016-17 and allowed that appeal as well for statistical purposes.
The Tribunal ultimately allowed both appeals for statistical purposes and remanded the matters back to the CIT(A) for fresh adjudication after the jurisdictional High Court decides the pending issues relating to alleged bogus purchase bills by rice millers.
FULL TEXT OF THE ORDER OF ITAT RAIPUR
The captioned appeals preferred by the assessee emanates from the respective orders of the Ld. CIT(Appeals), Raipur-3, dated 24.12.2025 for the assessment years 2015-16 & 2016-17 as per the grounds of appeal on record.
2. At the time of hearing, none appeared for the assessee. However, an adjournment petition has been filed which is rejected. The matters are heard after recording the submissions of the Ld. Sr. DR and on a careful perusal of the materials available on record.
3. The Ld. Sr. DR submitted that the matters pertains to the issue of bogus purchases by rice millers which is the issue sub-judice before the Hon’ble Jurisdictional High Court. We will take up the appeal of the assessee in ITA No.185/RPR/2026 for A.Y.2015-16 as lead matter.
4. Brief facts in this case are that the assessee had filed its return of income for A.Y.2015-16 on 19.02.2016 declaring total income at Rs.8,21,840/-. The case was previously assessed u/s. 143(3) of the Income Tax Act, 1961 ( for short the Act’) on 14.07.2017 determining total income at Rs.19,66,360/-. Subsequently, based on specific and credible information received from the Investigation Wing, Raipur, the case was reopened u/s. 147 of the Act after obtaining approval u/s. 151 of the Act from the competent authority. The information revealed that the assessee was a beneficiary of accommodation entries in the nature of bogus purchases from the concerns viz. i) M/s. Shri Vaishno Devi Exim, Prop. Shri Kapil Kumar Jain: Rs.51,08,750/-; ii) M/s. Maa Sharda Process, Prop. Shri Rakesh Sharma: Rs.30,00,000/-, totaling Rs.81,08,750/-. Both the proprietors of the above concerns had categorically admitted before the ITO (Inv.), Raipur that their concerns were engaged only in providing bogus purchase bills and all the transactions made through the said bank account were not related to any real business activities and amounts received from beneficiaries were returned in cash after rotation through bank accounts.
5. During assessment proceedings, despite opportunities the assessee failed to produce any documentary evidence regarding actual movement of goods from supplier to assessee and from assessee to customer. Accordingly, the A.0 treated the total purchases of Rs.81,08,750/- as unexplained expenditure u/s.69C of the Act and assessed income at Rs.1,00,75,110/-.
6. In this regard, the Ld. Sr. DR submitted that in both these appeals, the issue of obtaining benefits through bogus purchase bills by rice millers is sub-judice before the Hon’ble Jurisdictional High Court vide various cases filed before the said forum. The Ld. Sr. DR had furnished a list as follows:
“1. Keshari Rice Industries (ITA No. 410/RPR/2024 dt. 23.12.2024) for the Asstt. Year 2016-17.
2. Kishore Kumar Panjwani (378/RPR/2024 dt. 08.10.2024) for the Asstt. Year 2014-15.
3. Arvind Kumar Agrawal-(51/RPR/2025 dt. 18.03.2025) for the Asstt. Year 2015-16.
4. Sandeep Agrawal-MA. No. 22/RPR/2019 dated 28.05.2024 (Arising out of ITA No. 16/RPR/2016) for the Asstt. Year 2010-11.
5. Sudhir Kumar Bansal (Filed recently Limitation 11.12.2025)
6. Gurunanak Rice Industries – (ITA 370/RPR/2024 dt. 02.09.2024) for the Asstt. Year 2015-16.”
7. That on similar parameter, the ITAT, DB, Raipur in the cases of M/s. Gindlani Rice Mill Vs. ITO-1(2), Raipur (C.G.), ITA Nos. 813 & 814/RPR/2025, dated 18.03.2026 has held and observed as follows:
“5. In this regard, the Ld. Sr. DR submitted that in both these appeals, the issue of obtaining benefits through bogus purchase bills by rice millers is sub-judice before the Hon’ble Jurisdictional High Court vide various cases filed before the said forum. She had submitted a list of the cases which are as follows:
“1. Keshari Rice Industries (ITA No. 410/RPR/2024 dt. 23.12.2024) for the Asstt. Year 2016-17.
2. Kishore Kumar Panjwani (378/RPR/2024 dt. 08.10.2024) for the Asstt. Year 2014-15.
3. Arvind Kumar Agrawal-(51/RPR/2025 dt. 18.03.2025) for the Asstt. Year 2015-16.
4. Sandeep Agrawal-MA. No. 22/RPR/2019 dated 28.05.2024 (Arising out of ITA No. 16/RPR/2016) for the Asstt. Year 2010-11.
5. Sudhir Kumar Bansal (Filed recently Limitation 11.12.2025)
6. Gurunanak Rice Industries – (ITA 370/RPR/2024 dt. 02.09.2024) for the Asstt. Year 2015-16.”
6. That on similar parameter, the ITAT, SMC Bench, Raipur in the case of Vinod Kumar Agrawal Vs. ITO, Raipur, ITA No.630/RPR/2025, A.Y.2016-17, dated 11.12.2025 has held and observed as follows:
“2. Parties herein submitted that the issue pertains to the fact that the assessee herein is a rice miller and that as alleged by the Department he had obtained the benefit of bogus purchase bills from various agents and hence, the bogus purchase amount @ Rs.25% was added to the total income of the assessee. In this regard, Ld. Sr. DR submitted that this this issue of obtaining benefits through bogus purchase bills by rice millers is sub-judice before the Hon’ble Jurisdictional High Court vide various cases filed before the said forum. She had submitted a list of the cases which are as follows:
“1. Keshari Rice Industries (ITA No. 410/ RPR/2024 dt. 23.12.2024) for the Asstt. Year 2016-17.
2. Kishore Kumar Panjwani (378/RPR/2024 dt. 08.10.2024) for the Asstt. Year 2014-15.
3. Arvind Kumar Agrawal-(51/RPR/2025 dt. 18.03.2025) for the Asstt. Year 2015-16.
4. Sandeep Agrawal-MA. No. 22 / RPR/ 2019 dated 28.05.2024 (Arising out of ITA No. 16/RPR/2016) for the Asstt. Year 2010-11.
5. Sudhir Kumar Barisal (Filed recently Limitation 11.12.2025)
6. Gurunanak Rice Industries – (ITA 370/RPR/2024 dt. 02.09.2024) for the Asstt. Year 2015-16.”
3. In this scenario, it would not be appropriate for this Bench to determine the facts and circumstances pertaining to the said additions on issue of procurement of bogus purchase bills by the assessee. At the same time, it would also not serve any logical purpose by keeping the matter pending at this level and therefore, it would be most appropriate that the said matter be remanded back to the file of the CIT(A)/NFAC and that the first appellate authority shall wait for the decision of the Hon’ble Jurisdictional High Court in the aforestated matters on the issue stated herein, and thereafter shall adjudicate denovo as per law while complying with the principles of natural justice.
4. That even without going into the merits of the matter on consideration of facts that the effective issue in this matter is already subjudice before the Hon’ble Jurisdictional High Court, the same is therefore, restored to the file of the CIT(A)/NFAC, as per the aforestated directions. The order of CIT(A)/NFAC is set-aside accordingly.
5. Before parting, it is made clear that this remanding of the matter to the file of the CIT(A)/NFAC shall not alter/amend any factual scenario pertaining to the case of the assessee. The facts and circumstances of the case and the point of law has to be decided afresh only after the decision by the Hon’ble Jurisdictional High Court as per its order, which shall be the main guideline while deciding this case by the first appellate authority.
6. As per the above terms, the grounds of appeal by the assessee stands allowed for statistical purposes.
8. In the result, the appeal of the assessee is allowed for statistical purposes.”
7. Respectfully following the aforesaid judicial pronouncement, on same parity of reasoning and while maintaining rule of consistency as per similar terms, we set aside the order of the Ld. CIT(Appeals)/NFAC and remand the matter back to its file with similar direction as recorded in ITA No.630/RPR/2025 (supra).
8. In the result, appeal of the assessee in ITA No.813/RPR/2025 for A.Y.2014-15 is allowed for statistical purposes.”
8. Respectfully following the aforesaid judicial pronouncement, on same parity of reasoning and while maintaining rule of consistency as per similar terms, we set aside the order of the Ld. CIT(Appeals) and remand the matter back to its file with similar direction as recorded in the aforesaid decision (supra).
9. That as per above terms, the appeal of the assessee in ITA No.185/RPR/ 2026 for A.Y.2015-16 is allowed for statistical purposes.
ITA No.186/RPR/2026
A.Y.2016-17
10. Since facts and issues involved in the captioned appeal remains the same as were there before us in ITA No.185/RPR/2026 for A.Y.2015-16, therefore, our decision rendered in ITA No.185/RPR/2026 for A.Y.2015-16 shall mutatis mutandis apply to ITA No.186/RPR/2026 for A.Y.2016-17.
11. In the result, appeal of the assessee in ITA No.186/RPR/2026 for A.Y.2016-17 is allowed for statistical purposes.
12. To sum up, both the appeals of the assessee are allowed for statistical purposes as per afore-stated terms.
Order pronounced in the open court on 05th May, 2026.
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