2026 (3) TMI 374

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.... AO in the impugned assessment order for AY 2013-14, the ITAT, Bench-G, New Delhi vide order dated 20.6.2025 in ITA No. 7761/Del./2018 and ITA No. 7189/del/2018 has deleted the addition in assessee's own case for AYs 2014-15. Hence, the addition of Rs. 1,17,46,145/- in the impugned assessment order for AY 2013-14 deserves to be deleted. 2. That on the Facts and circumstances of the case, the Assessment order passed by the Ld. CIT(A) is bad in law. 3. That Ld. CIT(A) has erred both in law and on the facts of the case in passing the assessment order pending the final order from excise department. 4. That Ld. CIT(A) has erred both in law and on the facts of the case in relying on documents recovered from premises of ....

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....6. Further, the AO had received information from Central Excise Department that the assessee company evaded Union Excise Duty on account of clandestine sale. The case of the assessee was reopened u/s. 147 of the Act and notice u/s. 148 of the Act issued on 20.8.2018. In response to the said notice, the assessee had filed return of income for AY 2013- 14 on 21.9.2018 declaring total income of Rs. NIL. The AO passed the assessment order u/s. 143(3) r.w.s. 147 of the Act on 28.12.2019 determining total income at Rs. 1,11,59,630 by making the following additions:- i) Depreciation debited to P&L account of Rs. 22,94,500/-. ii) Disallowance on account of penalty of Rs. 5,00,965/-. iii) Addition made vide order u/s. 143(....

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...., the addition made by the A.O. in the hands of the Assessee will not sustain. Ld. Counsel for the assessee submitted that on identical issues, the ITAT, Bench-G, New Delhi vide order dated 20.6.2025 in ITA No. 7761/Del/2018 and ITA No. 7189/Del/2018 has deleted the addition in assessee's own case for AYs 2014-15. Hence, the addition of Rs. 1,17,46,145/- in the impugned assessment order for AY 2013-14 deserves to be deleted. 6. Per contra, the ld. Ld. Departmental Representative relying on the orders of the Lower Authorities, sought for allowing the Appeal. 7. We have heard the rival contentions and perused the records, especially the order of the ITAT, Bench-G, New Delhi dated 20.6.2025 passed in ITA No. 7761/Del/2018 and ITA No. 718....

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....emises of the assessee as well. However, Central Excise Department could not recover any adverse material from the premises of the assessee either. 11. The AO in the instant case has also not brought any material on record adverse to the assessee. The sole basis of estimated addition is a show cause notice issued by the Central Excise Department, the aforesaid proceedings against the third party (Trikoot) by Central Excise Department has been quashed and therefore, no firm basis exists any longer against the assessee. Thus we find substantial force in the plea of the assessee for reversal of the additions on this score. 12. As emerges from the assessment order, the AO has entertained adverse inference based on 'show cause ....

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..... No independent material to corroborate the allegation of unrecorded sales is available on record. The ratio of judgement referred in the case of PCIT vs SapoorjiPallonji& Co. Ltd. (supra) would thus squarely apply. The Hon'ble Bombay High Court in that case observed that the AO had merely relied upon the information received from the Sales Tax Department, Government of Maharasthra without carrying out any independent enquiry." 8. It is also noticed that the Ld. A.O. issued a show cause notice on the sole basis of the notice issued by the Central Excise Department to the Assessee pursuant to the search conducted by the central Excise Department on the premises of M/s Trikoot Iron and Steel Ltd. The Ld. A.O. made the addition pursu....