2026 (3) TMI 938

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....1961 (hereinafter referred to as 'the Act') dated 27.03.2024 by the Assessing Officer, Assessment Unit, Income Tax Department (hereinafter referred to as 'ld. AO'). 2. The ld AR at the outset argued Ground No. 11 challenging the non-applicability of provisions of Section 69C of the Act to the facts and circumstances of the instant case. Hence we deem it fit to address the same first. 3. We have heard the rival submissions and perused the material available on record. The assessee is a private limited company engaged in the business of manufacturing of lithium-ion batteries used in mobile phones at factory premises in Noida. The original return of income for AY 2019-20 was filed on 28.11.2019 admitting loss of Rs. 14,75,62,311/-. Durin....

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....he same, the assessee filed a detailed submission dated 12.03.2024 before the ld AO. The ld AO completed the reassessment disregarding the evidences submitted by the assessee by passing an order u/s 147 of the Act on 27.03.2024 after making an addition of Rs. 3,17,23,379/- u/s 69C of the Act. 6. It is pertinent to note that assessee had furnished the details of transactions it had with the aforementioned 3 parties by stating that it had purchased certain items which had been capitalized / shown as capital advances paid, as the case may be, by the assessee in its books as under:- Name of Party Amount as per Notice Amount as per books of accounts Capitalised without GST GST Total amount payable TDS Net amount paid ....

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....ering Pvt. Ltd and confirmed the addition in respect of other two parties. 8. At the outset, we find that all the transactions the assessee had with the aforesaid parties had already been duly accounted in the books of account of the assessee. The payments made thereon were sourced out of accounted source of the assessee company. Now the short point that arises for our consideration is as to whether the provisions of Section 69C of the Act could at all be made applicable by the lower authorities in the facts and circumstances of the instant case to the aforesaid transactions with the aforesaid parties. It is pertinent to note that the lower authorities in the instant case had not doubted the source of incurrence of expenditure of the ass....