TaxTMI 
TaxTMI 
2026 (4) TMI 1629
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....84%. That, the case of the appellant was selected for scrutiny assessment on the ground that the selling dealers from the whom the appellant had made purchases had either not filed ITR or have filed non-business ITR or shown substantial lower turnover. During the course of the assessment proceedings, the appellant had submitted the details of purchases like purchase bill, bilty, stock register etc. 3. That, the case of department is that Assessment Unit made verification from the selling dealers and four of the selling dealers has denied undertaking any transaction with the appellant. Thus, the Ld AO made addition of the entire amount aggregating to Rs 3,77,13,080/- u/s 69C of the Act. Then with respect to other selling dealers who had not responded to the notices issued by the assessment unit, Ld. AO made addition of 8% on purchases value, thus, the addition was aggregated to Rs. 14639233 (ie 8% on Rs 182990406). Further, with respect to difference in ledger balance of M/s Jain Sons India, addition of Rs 26,41,990/- was made by the Ld AO u/s 41(1) of the Act. 4. At the first appellate stage the assessee has succeeded as with regard to addition of the entire amount aggregatin....
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.... 3. On facts and circumstances of the case and in law, the Ld. CIT(A) has erred in admitting the additional evidences in absence of the rebuttal from the assessee as regards the submission of the Assessing Officer on merits of the petition for. admitting additional evidence. 4. On facts and circumstances of the case and in law, the Ld. CIT(A) has erred in interpreting the remand report to the benefit of the assessee ignoring the finding of the AO where after verification of tax invoices, ledger, GSTIN status etc., it was revealed that the GSTIN were suo-moto cancelled for these entities and that the relevant purchase entries were created to balance the credits in the guise of purchases from these entities. 5. On facts and circumstances of the case and in law, the Ld.CIT(A) has erred in allowing estimation of profit @ 8% on bogus purchase of Rs. 3,77,13,080/- even when the suppliers had categorically denied about the transactions and the assessee failed to rebutt the findings of the AO in the remand report. 6. That the appellant craves leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are w....
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.... to be applied on bogus purchases. 8. We have given thoughtful consideration to the material on record and in regard to the issue on which both the sides are in appeal, we find that additions made by the Ld AO are merely based on suspicion ignoring the crucial fact that the AO had primary information with respect to purchases made by the appellant through sharing of information from GSTN portal wherein the selling dealer had duly disclosed the sales made to the appellant in his GSTR-1 and GSTR-1 would have been filed by the selling dealer using his own credentials only if the registration was active at the time of transaction. Mere subsequent cancellation of registration retrospectively or non-response to notices issued u/s 133(6) of the Act would not affect the genuineness of the transaction undertaken prior to cancellation. Assessee has pleaded that purchases were made through a broker whose details were provided in the submissions to Learned CIT(A) and also taken a plea that assessee may also have been duped by the intermediary. That is a quite reasonable explanation to discard the suspicion and hold that any subsequent changes made by the sellers in their GSTN portal details....
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.... the assessee. To put it differently the Assessing Officer has not made out a case that conditions laid down in section 145(3) of the Act are satisfied for rejection of the books of account. Thus, when the books of account are maintained by the assessee in accordance with the system of accounting, in the regular course of his business, the same would form the basis for computation of income. In the instant case it is noticed that neither the Assessing Officer nor the Commissioner of Income-tax (Appeals) have rejected the books of account maintained by the assessee in the course of the business. As such the Tribunal has rightly rejected or set aside the partial addition made by the Assessing Officer for arriving at gross profit and sustained by the Commissioner of Income-tax (Appeals) and rightly held that the entire addition made by the Assessing Officer was liable to be deleted. The said finding is based on sound appreciation of facts and it does not give rise for framing substantial question of law." 11. The decision which ld. DR has relied in the case of Global Stainless Vs. ACIT vide ITA No. 3990/Del/2025, order dated 20.03.2026 does not help the case of revenue as that was ....