TaxTMI 
TaxTMI 
2026 (3) TMI 685
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.... for A.Y. 2012-13. The assessment was framed by the Assessing Officer [for shot, "AO"] vide its order dated 14.11.2019 u/s 143(3) r.w.s 147 of the Act. 2. The assessee has raised following grounds of appeal: " 1. On facts and circumstances of the case, the authorities below have erred in upholding the reassessment proceedings ignoring the fact that impugned assessment is invalid and without jurisdiction as the said assessment is completed without complying with legal requirements of the provisions of section 147/148/151 of the Income Tax Act therefore such assessment is void ab initio and liable to be quashed. 2. On facts and circumstances of the case, the authorities below have erred in upholding the reassessment proce....
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....ade without rejecting books of account u/s 145(3) of IT Act. 6. The Ld. CIT(A) has erred both in law and on facts in the case in upholding the addition on account of purchases of Rs. 11,31,282/- made from Shubham Agro India treating the same as bogus purchase in terms of provisions of sec 69C of the Act ignoring the fact that the appellant has submitted all relevant documents in evidence of purchase and the AO has not made any adverse inference on the documents submitted by the appellant. The additions made by the AO are based on mere suspicion, surmises and conjectures which are unsustainable, arbitrary and unjustified. 7. The appellant craves leave to add, DLEETE, modify / amend the above grounds of appeal with the permi....
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....erits. 4.1 We first take up the Ground Nos. 5 & 6 relating to merits of the addition. Ld. AR has made the following written submissions in this regard: "Ground Nos.5 and 6 Merits of addition of Rs. 11,31.282/- u/s 69C of IT Act. The appellant is in business of processing/resale of rice and in its regular course of business activity, it makes purchases from various parties directly or through brokers. The purchases from M/s SAI has also been made as a part of core activity of purchasing rice. The appellant in support of above purchases has submitted following evidences: a. Ledger account of SAI; b. Relevant period bank statement; c. Purchase invoices ; d. Stock Register; e. Pa....
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.... 2012-13. There has been increase in turnover in corresponding years from Rs. 100.80 Crore to Rs. 116.21 Crore. There is overall increase in net profit from Rs. 73 Lakh to Rs. 1.88 Crore in the above comparable periods. The AO did not find any instance of either the purchases not entered in the books of accounts and actual sales not booked therein. It is a settled law that If the books of account are not rejected by the AO u/s 145(3) of IT Act, the AO is not within his power to make trading additions contrary to the mechanism placed in the Act u/s 145(1) of the it Act. Reliance is placed on the following authorities: * CIT Vs Pashupati Nath Agro Food Products Pvt. Ltd. (Allahabad High Court) ITA No. 165 of 2010 dated 04.05....
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....CIT vs Radhika Creation ITA No.692/2009 (Del) dated 30.04.2010 wherein it was held that as the expenditure was accounted in the regular books, the source is obviously explained. The provisions of Section 69C are not applicable as there was no unaccounted expenditure. Further, reliance is placed in following decisions: * Parekh Corporation UI Building (32 CCH 129) the Mumbai Tribunal: * M/s Fancy wear vs ITO ITA No.1596/Mum/2017 dt: 20.09.2017; * ACIT vs S.K. Integrated Consultants and ors ITA No.4862/Del/2024; * ITO vs Ritu Bhandula ITA No.2750/Del/2025 dated 11.02.2026." 4.2 On the other hand, Ld. DR has strongly relied on the orders of the lower authorities. He has pointed out the basis of addition w....