2026 (4) TMI 827

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....ders passed under section 147 r.w.s. 144B of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') relating to the Assessment Years 2014-15, 2015- 16 and 2016-17. Since common issue of addition under section 68 of the Act is involved in all these appeals, for the sake of convenience, the same are disposed of by this common order. 2. ITA Nos.1362/Ahd/2025 is taken as lead a lead case. Brief facts of the case is that the Assessee was having a rolling mill and engaged in manufacturing activity of stainless steel, S.S. Patta/Patti, S.S. Flat and also engaged in job work activity for materials received from the various vendors. For the Assessment Year 2014-15, the Assessee filed its Return of Income on 30.09.2014 declaring total inc....

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....nly salary income and no business income by M/s. Kabra and Company, as well as VAT registration was also cancelled by the Gujarat VAT department. Thereby the Assessing Officer made an addition of Rs. 1,60,86,323/- under section 68 of the Act and also calculated tax under Section 115 BBE of the Act. 3. Aggrieved against the reassessment order, the Assessee filed an appeal before the CIT(A), who has confirmed the additions made by the Assessing Officer, thereby dismissing the appeal filed by the Assessee. 4. Aggrieved against the same, the Assessee is in appeal before us raising the following Grounds of Appeal: "1. The Ld. CIT(A) has erred, both in law and on facts, in confirming the action of AO in reopening the case of the as....

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....not have been taxed since the Assessee has recorded such sales in the audited books of accounts and paid taxes thereon; referring to the voluminous paper book running to 2040 pages filed by the Assessee. Further, such sales and profit have been accepted by the learned AO and he has not rejected the audited books of accounts. In such circumstances, only the profit element embedded in such sales could have been taxed and submitted a note of the net profit as follows: * Tax Audit Reports containing NP rates of three years in question are placed at following pages of Volume VI of Paperbook: * AY 2014-15 - Pgs. 1993-2006 @ 2001 of PB-VI (NP : 0.96%); * AY 2015-16 - Pgs.2007-2020 @ 2020 of PB-VI (NP : 0.36%); *....

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....t of sales made to the five parties and disallowed Rs. 1,60,86,323/- as against the total sales of Rs. 2,12,23,718/- made by the Assessee company. The only reason made out by the Assessing Officer was that the VAT registration number of M/s. Kabra and Company was cancelled by the Gujarat VAT department. There is no verification by the Assessing Officer about the date of cancellation of the VAT registration by VAT department. However, based on the information received from the Investigation Wing, the Assessing Officer made addition under section 68 of the Act. The Assessee during the appellate proceedings clarified that M/s. Kabra and Company, wherein the proprietor Kabra Suresh Prabhulal, as Kartha in his HUF capacity, and not in individual....