OSIA IMPEX,,CHENNAI vs. ITO, NON CORPORATE WARD-1(6), CHENNAI

This appeal filed by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi dated 20.03.2023 relevant to the assessment year 2018-19.

Brief facts of the case are that the assessee has filed its return of income for the assessment year 2018-19 on 25.08.2018 declaring total income at ₹.61,020/-. The case was selected for complete scrutiny and after considering the details furnished by the assessee, the Assessing Officer has completed the assessment under section 143(3) of the Income Tax Act, 1961 [“Act” in short] assessing total income of the assessee at ₹.48,00,692/- after making addition of ₹.32,69,580/- as unexplained investments under section 69 of the Act and ₹.14,70,092/- as unexplained cash credits under section 68 of the Act. On appeal, after considering the submissions of the assessee, while confirming the addition made under section 69 of the Act, the ld. CIT(A) deleted the addition made under section 68 of the Act and partly allowed the appeal of the assessee.

On being aggrieved on confirmation of addition made under section 69 of the Act, the assessee carried the matter in appeal before the Tribunal.

Heard both the sides, perused the materials available on record and gone through the orders of authorities below. During the course of assessment proceedings on verification of balance sheet, the Assessing Officer noted that during the year under consideration ₹.32,69,580/- has been taken as opening stock of Bullions for the financial year 2017-18. But, in the balance sheet as at 31.03.2017 furnished by the assessee closing stock stood at NIL. Therefore, the assessee has booked excess opening stock in the year under consideration due to which the profit of the assessee was undervalued for the year. In this regard, the Assessing Officer called for explanation and documentary evidence from the assessee. The assessee had not furnished any reply to the show cause notice. Accordingly, the Assessing Officer added the amount of ₹.32,69,580/- to the total income of the assessee as unexplained investment under section 69 of the Act r.w.s. 115BBE of the Act. On appeal, the ld. CIT(A) confirmed the addition.

In the result, the appeal filed by the assessee is allowed for statistical purposes.