TaxTMI 
TaxTMI 
TaxTMI 
2025 (7) TMI 1769
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....e facts and circumstances of the case and in law, no notice under section 143(2) issued is invalid and non-est and CIT(A) erred in not holding so." 3. Brief facts of the case are that, the Assessee filed return of income declaring total income of Rs. 95,42,440/-. The return of the Assessee was processed u/s 143(3) of the Income Tax Act, 1961 ('Act' for short). Subsequently, the case was selected for scrutiny through CASS on the reasons that 'High liabilities as compared to low income/receipt and Assessee has made substantial purchases from suppliers who are non-filer(s)'. An Assessment order came to be passed u/s 144 r.w. Section 144B of the Act by making addition of Rs. 12,50,99,530/- by establishing the profit @ 10% on the turnover. Aggrieved by the assessment order dated 28/03/2024, the Assessee preferred an Appeal before the Ld. CIT(A). The Ld. CIT(A) vide order dated 10/07/2024, dismissed the Appeal filed by the Assessee. Aggrieved by the order of the Ld. CIT(A) dated 10/07/2024, the Assessee preferred the present Appeal on the grounds mentioned above. 4. Ground No. 1 to 3 are relate to addition of Rs. 12,50,99,530/- made by the A.O. which has been upheld by the Ld.....
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....rities and rightly made the addition, which requires no interference at the hands of the Tribunal. The Ld. Departmental Representative relying on the findings and conclusion of the Lower Authorities, sought for dismissal of the Appeal. 6. We have heard both the parties and perused the material available on record. During the assessment proceedings, a show cause notice has been issued to the Assessee on 25/02/2024 by proposing the following additions:- S. No. Particulars Amount 1 Unsecured loans 5,74,76,559 2 Sundry creditors 7,74,13,954 13,48,90,513 3 Purchase from 13 parties 32,56,61,364 7. In response to the above show cause notice, the Assessee submitted reply on 01/03/2024 to the A.O. The said reply and the acknowledgement for the reply are produced before us in Page No. 7 to 10 of the Paper Book. After going through the reply filed by the Assessee, A.O. found that the explanation given by the Assessee is satisfactory and accordingly, not made any addition which has been proposed in the show cause notice dated 25/02/2024. 8. Further, the Ld. A.O. issued one more notice on 13/03/2024 proposing to make entirely different additions to that of propos....
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...., profits or gains of an assessee." 11. The Hon'ble jurisdiction Delhi High Court in the case of CIT vs. Poonam Rani (2010) 5 Taxmann.com 76 held that in the absence of any material pointing towards falsehood of accounts books, addition of gross profit and rejection of books of accounts cannot be made. 12. The Hon'ble jurisdictional Delhi High court in the case of CIT v Paradise Holidays (2010) 325 ITR 13 (Delhi) held as under:- 6. The Assessing Officer has not pointed out any specific defect or discrepancy in the Account Books maintained by the assessee. Admittedly, the assessee had been maintaining regular Books of Accounts, which were duly audited by an independent Chartered Accountant. As noted by CIT(A), the financial results were fully supported by the assessee with vouchers and the Books of Account were complete and correct in all respects. The accounts which are regularly maintained in the course of business and are duly audited, free from any qualification by the auditors, should normally be taken as correct unless there are adequate reasons to indicate that they are incorrect or unreliable. The onus is upon the Revenue to show that either the Books of Account....
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....e ledger copy submitted by the Assessee. It is found that the Assessee vide reply dated 21/03/2024, provided explanation in respect of each and every party which can be seen from pages 56 to 64 of the Paper Book. As per the Assessee, the A.O. had not appreciated the fact correctly. However, it is found that at no point of time the A.O. pointed out any discrepancy in the submission/explanation filed by the Assessee. During the assessment proceedings, A.O, never asked any query in respect of expenses except interest expenses. Assessee provided the details of interest expense along with the details/confirmation/documentary evidences of all the loans along with the TDS Certificate. After considering those documents, the A.O. made no addition in respect of any of the loans. However, gave finding in the assessment order that vouchers in respect of expenses were not forthcoming, which is contrary to the fact on record. 17. The Ld. A.O. has assigned one more reason for making the addition that some of the purchase parties were inactive on the GST Portal and not filed Income Tax Return. In our considered opinion, merely because some of the purchase parties are not having active GST Portal ....
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....) is better than GP rate of immediately preceding year. The GP Rate for the year under consideration is 1.91%, whereas it was 1.78% during immediately preceding year i.e., A.Y. 2021-22. The case of the assessee for A.Y 2021-22 was also completed u/s 143(3) of the Act vide assessment order dated 29/12/2022 in which similar business and books of accounts were accepted by the assessing officer. The assessing officer made a specific addition of Rs. 98,40,545/- in respect of one party which has been deleted by the Co-ordinate Bench of the Tribunal in ITA No. 4697/DEL/2024. Thus, the GP declared of 1.78% in last year i.e. A.Y. 2021-22 stands accepted. Thus, as observed earlier, the GP Rate for the year under consideration i.e., A.Y. 2022-23 is 1.91% which is better than last year. Therefore, there is no cogent reason for the authorities to apply the rate of profit by calculating @ 10% on the turnover for the year under consideration. 21. In the present case, the Assessee has submitted all the details and documentary evidence including the party wise details of purchase and sales, complete stock register, copy of all purchase and sales bills including e-way bills, ledger accounts and exp....