S N THAKKAR INFRASTRUCTURE PRIVATE LIMITED,MUMBAI vs. CIRCLE 14(1)(2), MUMBAI, MUMBAI
Income Tax Appellate Tribunal, MUMBAI BENCH “F” MUMBAI
Before: SHRI SANDEEP GOSAIN () & SHRI OM PRAKASH KANT () Assessment Year: 2018-19
PER OM PRAKASH KANT, AM
This appeal by the assessee is directed against order dated
11.07.2025 passed by the Ld. Commissioner of Income-tax
(Appeals) – National Faceless Appeal Centre, Delhi [in short ‘the Ld.
CIT(A)’] for assessment year 2018-19, raising following grounds:
Ground 4 - The Id. CIT(A) has erred in sustaining the addition of Rs.
41,18,214, being arbitrary estimation of net profit @ 20% on receipts of Rs. 2,05,91,068 from Vinayak Developers, disregarding the fact that the said are already included in the appellant's gross business revenue for im the income co tax in AY: 20
aforesaid arb taxation of sa case estimatio basis.
Ground 1 - Th raised before remand repor explain its ca appellant res please be set because the a notices during
Covid - 19. Ground 2 - T
Books of Acco by the appella appellant res
Accounts is n for and exam the books of consideration explanation fu
Ground 3 - Th
8% of the app percentage es and in comple in the appella year i.e. AY: 2
appellant res estimated onl
Net Profit rate assessment y
Ground 5 - A AO to exclude extent of Rs.
the present a 2. Briefly stated, engaged in the b
S N Thakkar
ITA mmediately preceding year i.e. AY: 2017
orresponding to these receipts are alrea
017 - 18. Your appellant respectfully sub bitrary addition of Rs. 41,18,214 amou ame income and should therefore be delet on itself can be made only on some legal he Id. CIT (A) has erred in dismissing bot him by the appellant without waiting fo rt. This has denied an opportunity to th ase to the ld. AO during the remand proc spectfully submits that the assessmen aside for Denovo assessment by the ld.
appellant was handicapped in respondin g assessment proceedings due to mass
The Id. CIT(A) has erred in sustaining th ounts observing that 'the books of accou ant before the AO were not complete and spectfully submits that the rejection ot justified since the books of accounts w mined either by the ld. AO OR the ld. CIT f accounts are rejected for invalid a ns, without properly appreciating doc urnished during the course of assessmen
The Id. CIT(A) has erred in sustaining Ne pellant's business revenue overlooking th stimated by the ld. AO is entirely basel ete disregard of the assessed Net Profit r ant's own case for immediately precedin
2017 - 18. Without prejudice to the other spectfully submits that the Net Profit ly on some legally sustainable basis like e in the appellant's own case for immedia year.
Alternatively, directions may please be gi e / reduce business income for AY: 201
41,18,214 in the event this addition is appeal.
facts of the case are that t business of real estate dev
Infrastructure Pvt. Ltd.
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A No. 4588/MUM/2025
- 18 and thus ady offered for bmits that the unts to double ted and in any ly sustainable th the grounds or the ld. AO's e appellant to ceedings. Your nt order may AO especially ng to the AO's sive spread of he rejection of unts produced d correct. Your of Books of were not called
IT (A). Further, and irrelevant cuments and t proceedings.
et Profit rate @
e fact that the less, arbitrary rate i.e. 3.83%
ng assessment grounds, your rate can be e the assessed ately preceding iven to the ld.
17 - 18 to the s sustained in the assessee is velopment and infrastructure constr assessee filed its retu income of ₹22,19,770
2.1 During the cour of the Income-tax Act notices under sectio calling upon the asse various expenditure wages, security charg technical services an guest-house expendit
The details sought contact numbers, an respective payees.
2.2 Although the as some items of expend
Subsequent notices i
03.02.2021 met with 2.3 Upon examinin
Officer recorded the f a) The assessee prod which contained mere supporting particulars
S N Thakkar
ITA ruction. For the year under con urn of income on 30.10.2018, d
0/-.
rse of scrutiny assessment unde t, 1961 (“the Act”), the Assessin on 142(1) dated 20.11.2020 a essee to furnish complete particu heads—such as purchases, r ges, professional and consultan nd design charges, work assess ture, vehicle hire charges and la included the names, PAN, po nd the nature and purpose of p ssessee furnished ledger extrac diture, the remaining details we issued under section 142(1) on similar incomplete compliance.
ng the partial information filed following deficiencies:
uced only ledger accounts of the ely the names of the payees, wit s.
Infrastructure Pvt. Ltd.
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A No. 4588/MUM/2025
nsideration, the declaring a total er section 143(3) ng Officer issued and 10.12.2020, ulars relating to ent, salary and ncy fees, fees for sment expenses, abour expenses.
ostal addresses, payments to the cts in respect of ere not provided.
12.01.2021 and .
d, the Assessing expenses, hout requisite b) No corroborative ev corresponding entries furnished.
c) The assessee failed or telephone numbers d) In respect of salary for only six employees
Officer found inexplica e) For work-assessme disclosed that the ent
2.4 In view of the ab failure to substantia expenditure, the Ass invoking section 145
at 8% of the gross income at ₹79,34,96
the assessee, an addi
2.5 Further, the As claimed credit of tax
M/s Vinayak Develo corresponding turno under consideration.
had already been ac
S N Thakkar
ITA vidence of payments—such as m s in the bank statements and ban d to produce the postal address, s of the payees.
y payments, PAN and address w s out of a total of sixteen, which able.
ent expenses of ₹6,66,595/-, the tire amount had been paid in cas bove shortcomings and the asse ate the genuineness and ver essing Officer rejected the book
(3) of the Act. He thereafter estim receipts of ₹9,91,87,059/-, d
65/-. After adjusting the net pr ition of ₹75,35,658/- was made ssessing Officer noted that th deducted at source in respect opers, amounting to ₹2,05,91, over had not been offered to t
. The assessee explained that t ccounted for in the preceding a Infrastructure Pvt. Ltd.
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A No. 4588/MUM/2025
marking the nk book—was e-mail address, were furnished the Assessing ledger sh.
essee’s repeated ifiability of the ks of account by mated the profit determining the rofit declared by .
e assessee had of receipts from ,058/-, but the tax in the year the said income assessment year
2017-18. The Assess and proceeded to e resulting in an additi
3. On further app details before the lea
However, after cons placed on record and affirmed the action o the appellate findings as under:
“6.1.8 I have facts, grounds proceedings. It profit @ 8%. B expenses and produce by the not produce a support of vari same ledger/ b the view that were not comp justified. In vi appellant is dis
3.1 Similarly, the Developers was also following reasoning:
“6.2.2 Accordin was show- cau completed trea as undisclosed the A.Y. 2017-
Appellant furni
S N Thakkar
ITA sing Officer, however, rejected t estimate profit at 20% on the ion of ₹41,18,214/-.
peal, the assessee furnished ce arned CIT(A) in support of the sidering the assessment order d the submissions advanced, th of the Assessing Officer. The rel s on the issue of low net profit s carefully considered the assessment order, of appeal and submissions furnished during t is found that the AO was fully justified for e
Before the AO the Appellant submitted o could not furnished all the bills which w e AO. During the appellant proceedings also ap any new evidence, such as complete bills ious expenses claimedby the Appellant. He o bills which appellant furnished before AO. so the books of accounts produced by appella plete and correct. Therefore, estimation of iew of above, the ground of appeal no-1 r smissed.”
addition relating to receipts o upheld. The learned CIT(A ngly, vide show-cause notice dated 06/03/20
used by the AO as to why the assessment ating Rs. 2,05,91,068/- received from Vinaya d. Appellant stated in its reply that the receip
-18 and refund has been claimed in the A ished Invoice, ledger, and Profit & loss A/c. f
Infrastructure Pvt. Ltd.
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A No. 4588/MUM/2025
this explanation e said receipts, ertain additional grounds raised.
r, the material e learned CIT(A) evant portion of stands extracted statement of g the appellate estimating net nly ledger of were asked to ppellant could s/vouchers in only submitted o I am also of ant before AO f net profit is raised by the from Vinayak
A) recorded the 021, Appellant should not be ak Developers pt included in A. Y. 2018-19. for A.Y. 2017-
The reply o acceptable beca i) Appellant fai whereas TDS c ii) In any finan other is payee. claimed receip reverse. Here, THAKKAR Α ITBA/AST/S/1 (Vinayak Devel Appellant is no iii) In mercanti expense after first assessee c not debit its ac accounting poli iv) In the docu and affix its s did not sign a approved the c that the transa v) Here, Appell to other entities vi) On perusal Date (It is pres its value is Rs. work order wh account for the only after comp party in its boo vii) On perusa period is 01/0 which proves th viii) On perusa assessee men Developers. Bu 2017-18. It cle the amount for cannot debit th ix) Appellant f details of sour nothing but ma is received in t S N Thakkar ITA of Appellant has duly been considered but s ause of following reasons:- iled to justify why income is included in the claimed in A. Y. 2018-19. ncial transaction, there are two parties, one . First, payer gives the cash/cheque etc. afte t of the cash/cheque etc. But, in this case first assessee claimed Page 6 of 9 AAO .Υ. INFRASTRUCTURE PRIVATE LIMITE 143(3)/2021-22/1032228439(1) receipt but lopers) did not claim to give anything. Hence, ot principally correct ile accounting policy, first payer debits his that payee credit his account being income. claimed credited its account while Vinayak D ccount. Hence, contention of Appellant is not icy. ment submitted by the Appellant invoice ass stamp for issuance of documents but Vinaya and affix its stamp at the place given for contention of documents. Hence, Appellant fai action is for the Α. Υ. 2017-18. ant is a company, so it should be more cautio s during the accounting for the transaction. of document, so called invoice, it is reveale sumed that W. O. means work order) is 25/ 3,65,00,000/-. From this information, it is v hich is not signed by other party does not giv e amount in the A. Y. 2017-18. It must be pletion for work or after crediting to the asse oks. al of document, so called invoice, it is reve 04/2017 to 25/04/2017 and bill date is hat transaction is purely related to A. Υ. 2018 al of document, so called invoice, it is also ntioned TDS recoveries of Rs. 3,90,352/- ut, Vinayak Developers did not made any early proves that Vinayak Developers never r assessee for A. Y. 2017-18 in its books. He he amount for Vinayak Developers in its books furnished the Profit & Loss a/c for A. Y. rce of credit including the name Vinayak anipulation of the account to substantiate tha the A. Y. 2017-18. Actually, Appellant failed t Infrastructure Pvt. Ltd. 6 A No. 4588/MUM/2025 same was not A.Y. 2017-18 is payer and er that, payee e, situation is OCS5345P- SN ED 2018-19 t other party , contention of account being . In this case, Developers did correct as per sessee signed ak Developers certified and iled to confirm ous comparing ed that W. O. /03/2017 and very clear that ve any right to accounted for essee by other ealed that Bill 26/04/2017 8-19. revealed that for Vinayak TDS for A. Y. ever credited nce, assessee s. 2017-18 with Developers is at the amount to disclose the said amount i Appellant inclu 2017-18 by ma x) From the abo A. Y. 2018-19 b the year under tried to show Further, assess support of the 4. The learned Co comprising pages 1 t has also moved an (Appellate Tribunal) evidence. The additio respect of expenditu charges, consultancy explains that althou furnished during the required further par stage. The relevant d under: “ (i) Purchase to (ii) Guest House (iii) Designer Ch (iv) Consultancy (v) Professional 5. Having heard consideration of the S N Thakkar ITA n the A. Y. 2018-19 to avoid any tax liab uded the amount received from Vinayak Deve anipulating to avoid any tax liabilities in A. Y. ove discussion, it is evident that transaction w but Appellant did not account the same in the r consideration, after detection the discrepan that said amount is incorporated in the A see did not furnish any conclusive and reliab e claim.” unsel for the assessee has file o 185. Along with the Paper Boo application under Rule 29 of Rules, 1963, seeking admissio onal evidence consists of party ure on purchases, guest-house y charges and professional fees ugh ledger accounts of these e course of assessment, the A ticulars which could not be pr details of additional evidence are otaling Rs. 5,83,49,258 e Rent totalling Rs. 6,99,000 harges totaling Rs. 3,00,000 y Charges totaling Rs. 3,18,500 l Fees totaling Rs. 77,805 the parties at length, an factual matrix, we are of the Infrastructure Pvt. Ltd. 7 A No. 4588/MUM/2025 bilities. Hence, lopers in A. Y. 2018-19. was related to e books during ncy, assessee . Y. 2017-18. ble evidence in d a Paper Book ok, the assessee the Income-tax on of additional y-wise details in e rent, designer s. The assessee expenses were ssessing Officer roduced at that e reproduced as nd upon due e view that the additional evidence s The details now furn addresses of the par bear directly on the and completeness of rejection of the sam documents go to the on a fair adjudication 5.1 In our consider best served by admi particularly as their Assessing Officer in the additional eviden 5.2 Consequently, t aside, and the matte for fresh adjudication after affording due Officer shall examine determine the issue o of income strictly in a 5.3 With regard t Developers, the Asse assessee’s contention S N Thakkar ITA sought to be adduced deserves nished—containing, inter alia, rties, their PANs, and supportin core issue in dispute, namely, f the books of account and the me under section 145(3) of root of the matter and have a m n of the controversy. red opinion, the interests of ju itting these documents as addi r absence had weighed signific invoking section 145(3). We ac nce under Rule 29. the impugned order of the learn r is restored to the file of the A n after considering the addition opportunity to the assessee. e the party-wise details of expe of rejection of books of account accordance with law. to the addition relating to essing Officer is directed to exa n that the income in question h Infrastructure Pvt. Ltd. 8 A No. 4588/MUM/2025 to be admitted. the names and ng particulars— the correctness justification for the Act. These material bearing ustice would be itional evidence, cantly with the ccordingly admit ned CIT(A) is set Assessing Officer nal evidence and The Assessing enditure and re- t and estimation M/s Vinayak mine afresh the ad already been recognized in an earl accordance with law granting adequate op 5.4 In view of our d Assessing Officer, th academic and do not 6. In the result, statistical purposes. Order pronoun (SANDEEP G JUDICIAL M Mumbai; Dated: 26/11/2025 Rahul Sharma, Sr. P.S.
Copy of the Order forward
1. The Appellant
2. The Respondent.
3. CIT
4. DR, ITAT, Mumbai
5. Guard file.
////
S N Thakkar
ITA lier year, and thereafter to decid w, after conducting necessary v pportunity to the assessee.
decision to restore the issues t he remaining grounds of appea require independent adjudicati the appeal of the assessee ced in the open Court on 26/
-
GOSAIN)
(OM PRAK
MEMBER
ACCOUNTA ded to :
BY ORDER
(Assistant Re
ITAT, Mu
Infrastructure Pvt. Ltd.
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A No. 4588/MUM/2025
de the matter in verification and to the file of the al are rendered on.
is allowed for 11/2025. KASH KANT)
ANT MEMBER
R, gistrar) umbai