Centurion Laboratories Pvt. Ltd. Vs ACIT (ITAT Ahmedabad)
Reassessment Quashed – Escaped Income Below Rs 50 Lakh Threshold GP Addition Held Double Taxation – Bogus Purchase Case Decided in Assessee’s Favour: ITAT Ahmedabad
The AO reopened assessment alleging bogus purchases of ₹4.09 Cr from an accommodation entry provider and added GP @13.85% amounting to ₹48.09 lakh. ITAT observed that actual purchases debited were ₹3.47 Cr (after excluding IGST) and alleged escaped income worked out to only ₹48.09 lakh, which is below the ₹50 lakh monetary threshold under sec 149(1)(b). Hence, assumption of jurisdiction u/s 148 itself was invalid and reassessment was quashed.
On merits also, the Tribunal noted that the assessee produced purchase orders, invoices, e-way bills, goods receipt records and bank payments through RTGS, while AO relied solely on investigation wing reports without independent enquiry or rejecting books u/s 145(3). Further, GP element was already embedded in returned income, and separate addition resulted in impermissible double taxation.
Accordingly, ITAT allowed the appeal, quashed reassessment proceedings and deleted the GP addition.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal is filed by the Assessee as against appellate order dated 10-06-2025 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, (in short referred to as “CIT(A)”), arising out of the reassessment order passed under section 147 r.w.s. 144B of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) relating to the Assessment Year 2019-20.
