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Income Tax Appellate Tribunal, SMC BENCH, PUNE
Before: SHRI R.S. SYAL
This appeal by the assessee arises out of the order dated 31-07-2023 passed by the CIT(A) in National Faceless Appeal Centre (NFAC), Delhi u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) in relation to the assessment year 2018-19.
The only issue raised in this appeal is against the confirmation of addition of Rs.6,92,441/-.
Briefly stated, the facts of the case are that the assessee had shown purchases of Rs.282.64 crore and sales of Rs.286.19 crore.
The Assessing Officer (AO) called upon the assessee to furnish the details of the parties from whom the purchases were made. The M/s.Rudraksh Chemicals Pvt. Ltd., assessee furnished such details. Thereafter, the AO issued notice u/s.133(6) to the suppliers requiring confirmation of the transaction with the assessee. Most of the suppliers responded to the same. The AO has drawn a chart at page 4 of the assessment order noting the amount of purchases shown by the assessee and amount of sales as confirmed by the suppliers with the difference, sum total of which comes to Rs.13,84,88,225/-. The AO held that the assessee did not include such purchases in the books of account and accordingly failed to offer income thereon. Applying the gross profit rate of 0.50%, being, the normal gross profit rate, he computed the addition of Rs.6,92,441/-, which came to be affirmed in the first appeal.
Aggrieved thereby, the assessee has approached the Tribunal.
I have heard the rival submissions and gone through the relevant material on record. It is seen that the basis of the addition is the difference in the amount of purchases as shown by the assessee and as confirmed by the sellers. The ld. AR submitted that actually no difference exists, for the reason that, in some of the cases, the suppliers included the amount of GST which was not so included by the assessee; whilst in others there were differences in the opening balances. He fairly admitted that such complete details could not be furnished before the authorities below. In view of the fact that the M/s.Rudraksh Chemicals Pvt. Ltd., assessee has now come up with a chart claiming that no difference exists in the purchases for the year under consideration on the reason stated above, I am of the considered opinion that it would be just and fair if the impugned order is set aside and the matter is restored to the file of the AO for making the assessment afresh on this point after giving a reasonable opportunity of hearing. I order accordingly.
In the result, the appeal is allowed for statistical purposes.
Order pronounced in the Open Court on 13th October, 2023.