RADHA BUILDTECH (INDIA) PRIVATE LIMITED,DELHI vs. DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 15, DELHI

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ITA 3537/DEL/2026Status: DisposedITAT Delhi12 August 2026AY 2023-244 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal followed its own precedent from earlier assessment years and estimated the Gross Profit at 8% for the current year, considering the assessee's line of business. The addition made by the AO and the enhancement by the CIT(A) were modified based on this estimation.

What were the facts?

The assessee company's income tax return for AY 2023-24 was selected for scrutiny. The AO made an addition of Rs. 10,41,516 for disallowed subcontract expenses, assessing total income at Rs. 4,78,99,226. The CIT(A) dismissed the assessee's appeal and enhanced the assessed income by Rs. 1,43,20,084.

What were the issues?

Whether the CIT(A) erred in confirming the addition of subcontract expenses and enhancing the assessed income without proper justification. Whether the enhancement by the CIT(A) was valid considering procedural requirements.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 40A(2)(b),Section 251(2),Section 270A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI

Before: SHRI SATBEER SINGH GODARA & SHRI NAVEEN CHANDRA

आयकर अपीलीय अिधकरण, िद�ी पीठ�, नई िद�ी INCOME TAX APPELLATE TRIBUNAL, DELHI BENCHES, NEW DELHI BENCH: A BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA 3537/DEL/2026 (िनधा�रण वष�/Assessment Year: 2023-24) RADHA BUILDTECH (INDIA) DY. COMMISSIONER OF PRIVATE LIMITED INCOME TAX, CENTRAL CIRCLE - 15 4/2885, GALI NO. 1, BIHARI COLONY, NEW DELHI-110032 Vs. JHANDEWALAN EXTENSION, DELHI NEW DELHI-110055, DELHI अपीलाथ� Appellant ��थ� Respondent

Permanent Account Number of AAFCR2481L Assessee:

अपीलाथ� �ारा/Appellant represented Sh Pramod Jain, CA & by: Sh Mukul Gupta, ADV ��थ� �ारा/Respondent represented by: Sh Balkishan Gopal, SR DR सुनवाई की तारीख / Date of conclusion of hearing: 12-Aug-2026 घोषणा की तारीख / Date of pronouncement: 12-Aug-2026 आदेश / ORDER PER NAVEEN CHANDRA, ACCOUNTANT MEMBER: This appeal is filed by the Assessee against the order of Ld. CIT(A), Delhi - 26 dated 21.02.2026 against the order dated 13.03.2025 passed under section 143(3) of the Income Tax Act, 1961 (‘Act’) by the DCIT, Central Circle-15, New Delhi for the Assessment Year 2023-24.

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ITA 3537/DEL/2026 RADHA BUILDTECH (INDIA) PRIVATE LIMITED 2. The Assessee has raised the following grounds of appeal:

1.

The order passed by the Ld. AO and CIT(A) is bad in law and against the facts of the case. 2. That the Ld. CIT(A) erred in confirming the addition of Rs. 10,41,516 made by the Ld. AO on account of alleged disallowance of sub- contract expenses. 3. That the Ld. CIT(A) erred in enhancing the assessed income by Rs. 1,43,20,084, over and above the addition made by the Ld. AO. 4. That the enhancement made by the learned CIT(A) is bad in law and without jurisdiction for non-compliance with the mandatory provisions of section 251(2) of the Income-tax Act, 1961. 5. That the Ld. CIT(A) erred in in treating the sub-contract expenditure as bogus/non-genuine merely on suspicion, conjectures and surmises. 6. That the appellant carves leave to add, alter, modify or delete any of the ground of appeal. PRAYER On the facts and in the circumstances of the case and in view of judicial precedents, it is humbly prayed that: 1. Set aside the impugned order of the Ld. CIT(A) and the assessment order passed. 2. Addition of Rs. 1,53,61,600/- should be deleted.” 3. Brief facts of the case are that the assessee is the Private Limited Company, who e-filed its income tax return for 2023-24 on 30.12.2023 declaring income of Rs.4,68,57,710/-. The case was selected for scrutiny and various notices u/s 143(2) and 142(1) of the Act was issued which was duly complied from time to time. The case of the assessee company was assessed by the ld. AO by passing assessment order u/s 143(3) of the Act dated 13.03.2025, after making an addition of Rs.10,41,516/- on account of disallowance of contract expenses @6.78%

ITA 3537/DEL/2026 RADHA BUILDTECH (INDIA) PRIVATE LIMITED of the total contractual payment’s persons covered under Section 40A(2)(b) of the Income-tax Act, 1961 and assessed the total income at Rs.4,78,99,226/-. The AO also initiated penalty proceedings u/s 270A of the Act. 4. Aggrieved by the order of the AO, assessee filed appeal before the ld. CIT(A) who dismissed the appeal of the assessee by observing as under: “Hence, keeping in view the above facts and discussion and in order to remove any ambiguity, in absence of any substantial explanation from the appellant, the income of the appellant is enhanced by an amount of Rs. 1,43,20,084/- (Rs. 1,53,61,600/- minus Rs. 10,41,516/-) is made on account disallowance of bogus sub-contracts expenditure. And also, the addition made the AO of Rs. 10,41,516/- is upheld. The grounds raised by the appellant are hereby dismissed the income of the appellant is enhanced accordingly.”

5.

Aggrieved, assessee is now in appeal before us. 6. Before us, ld. Counsel for the assessee submitted that in the assessee’s own case for A.Ys 2014-15 to 2021-22, the ITAT vide its order in ITA Nos. 949, 951, 1132, 1137, 1935, 1936, 694, 695 and 1085/Del/2025 vide order dated 21.01.2026 has estimated the Gross Profit @ 8% and its line of activity of Civil Construction in real estate development etc. 7. Per contra, ld. DR relied on the order of the CIT(A)/AO. 8. We have heard the rival submissions and perused the material available on record. We find that in earlier years from AY 2014-15 to

ITA 3537/DEL/2026 RADHA BUILDTECH (INDIA) PRIVATE LIMITED AY 2021-22, the AO has estimated the Gross profit at a rate of 10% to 18%. The ITAT in assessee’s own case for A.Y. 2014-15 till 2021-22 has, vide it order dated 21.01.2026 (supra), estimated the Gross Profit @ 8% in its line of activity of Civil Construction in real estate development etc or the rate declared by the assessee whichever is higher. Following the judicial precedent, as no change in facts have been presented before us by the Revenue, we therefore, estimate the GP @8% for the instant year under consideration also. Appeal of the assessee is decided in aforesaid terms. 9. In the result, appeal filed by assessee in ITA No.3537/Del/2026 is partly allowed. Order pronounced in the open court on 12-Aug-2026 Sd/- Sd/- SATBEER SINGH GODARA NAVEEN CHANDRA JUDICIAL MEMBER ACCOUNTANT MEMBER Delhi Dated: 17-Sep-2026 Copy to: RADHA BUILDTECH (INDIA) PRIVATE LIMITED, 4/2885, GALI NO. 1, BIHARI COLONY, 1 NEW DELHI-110032, DELHI DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 15, 2 JHANDEWALAN EXTENSION, DELHI, NEW DELHI-110055, DELHI 3 THE PCIT / CIT, 4 THE D.R., ITAT, DELHI BENCH 5 GUARD FILE True Copy ASSISTANT REGISTRAR I.T.A.T., DELHI 4

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