ITO Vs AGL Logistics Pvt. Ltd. (ITAT Delhi)
Income Tax Appellate Tribunal (ITAT) Delhi has dismissed an appeal by the Income Tax Officer (ITO) against AGL Logistics Private Limited, thereby upholding the deletion of a significant tax addition of ₹11.73 crore. The tribunal’s decision reaffirms that an Assessing Officer (AO) cannot make a tax addition based solely on unverified Suspicious Transaction Report (STR) information without conducting further, independent verification.
The case originated from the assessment proceedings for the financial year 2018-19, during which the AO, based on STR intelligence, concluded that AGL Logistics had entered into high-value financial transactions. Specifically, the AO alleged that the company had received a credit of approximately ₹8.64 crore from M/s. TRAX ENT and another ₹3.01 crore from M/s. Shipair Logistics Private Limited. The total amount of these alleged transactions, approximately ₹11.73 crore, was added to the company’s income as unexplained cash credit under Section 68 read with Section 115BBE of the Income Tax Act.
According to the assessment order, the AO claimed that AGL Logistics had failed to provide bank statements and other relevant details during the assessment proceedings, which led to the ex-parte addition. The company subsequently appealed the order to the Commissioner of Income Tax (Appeals), or CIT(A).
