CREATIVE CONSTUCTION COMPANY,VADODARA vs. DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 1(1)(1) VADODARA, VADODARA

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ITA 2422/AHD/2025Status: DisposedITAT Ahmedabad20 July 2026AY 2015-165 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that since there was no evidence of the assessee undertaking any contract or receiving any income from the said party, the addition could not be made. Consequently, the addition confirmed by the CIT(A) was deleted.

What were the facts?

The Assessing Officer added Rs. 2,21,31,453 to the assessee's income based on TDS reflected in Form 26AS, as the assessee had not shown corresponding receipts. The CIT(A) confirmed an addition of 8% of this amount, i.e., Rs. 17,70,516.

What were the issues?

Whether income can be added to the assessee's income when there is no evidence of contract or receipt, solely based on TDS reflected in Form 26AS.

Which sections of the Income-tax Act were involved?

Section 131,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD

Before: SHRI SANJAY GARG & SMT. ANNAPURNA GUPTA

For Appellant: Shri Nitesh Thakkar, A.R, Shri Rohit Aasudani, Sr. DR
Pronounced: 20/07/2026

IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, AHMEDABAD BEFORE: SHRI SANJAY GARG, JUDICIAL MEMBER AND SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER आयकर अपील सं./I.T.A. Nos. 2422 & 2579/Ahd/2025 (िनधा�रण वष� / Assessment Year : 2015-16) बनाम Creative Construction Deputy Commissioner of / Company Income Tax, Vs. 38, Shardapark Society, Circle-1(1)(1), Vadodara Behind Arunachal Society, Subhanpura S.O., Vadodara, Gujarat -390023 Assistant Commissioner of Creative Construction & Income Tax, Company Circle-1(1)(1), Vadodara 13A Yogi Dashan, Nutan Bharat Society, Alkapuri, Opp. Nutan Bharat Club, Alkapuri,Vadodara, Gujarat -390007 �थायी लेखा सं./जीआइआर सं./PAN/GIR No. : AAEFC9647B (Appellant) .. (Respondent) Assessee by : Shri Nitesh Thakkar, A.R. Revenune by : Shri Rohit Aasudani, Sr. DR 22/04/2026 Date of Hearing Date of Pronouncement 20/07/2026

(आदेश)/ORDER Per Sanjay Garg, Judicial Member:

The captioned cross appeals have been filed by the assessee and Revenue against the order of the Ld. Commissioner of Income

ITA Nos.2422 & 2579/Ahd/2025 [Creative Construction Company] A.Y. 2015-16 - 2 –

Tax (Appeals), National Faceless Appeal Centre (hereinafter referred to as “NFAC”), Delhi (hereinafter referred to as “CIT(A)”), dated 10.10.2025 passed under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”) and relates to Assessment Year (A.Y.) 2015-16.

2.

The assessee in ITA No.2422/Ahd/2025 has raised following grounds:

“1. The Ld. CIT(A) has erred in confirming addition of Profit amounting to Rs. 17,70,516 (8% of turnover Rs.2,21,31,453) without appreciating the facts that the appellant firm had not undertaken any contract work with Mass Infrastructure Pvt. Ltd. Consequently, no income accrued from any such contract, nor was any amount received from the said party. Therefore, on facts and circumstances addition now. ling to Rs. 17,70,516 is ought to be deleted. It is prayed that same be held now. 2. The Order passed by the Ld. CIT(A) is bad in law and contrary to the provisions of lass and facts. It is submitted that the same be held so now. 3. Your appellant craves leave to add, alter, and/or amend all or any of the grounds before the final hearing of the appeal.”

3.

The Revenue in ITA No.2579/Ahd/2025 has raised following grounds:

“(i) "On the facts and circumstances of the case and in law, the Ld.CIT(A) has erred in restricting the addition to 8% of Rs.2,21,31,453/- and deleting the balance addition of Rs. 2,03,60,937/-, despite clear and cogent evidence on record in the form of Form 26AS, a statutory TDS record and the sworn statement u/s 131 of the Managing Director of M/s Mass Infrastructure P Ltd, establishing accrual of contract receipts to the assessee during the year."

ITA Nos.2422 & 2579/Ahd/2025 [Creative Construction Company] A.Y. 2015-16 - 3 –

(ii) The appellant craves leaves to add, modify, amend or alter any grounds of appeal at the time of, or before, the hearing of appeal.”

4.

Brief facts of the case are that the Assessing Officer (in short ‘the AO’) noted that one M/s. Mass Infrastructure Pvt. Ltd. had deducted TDS, which was reflected in Form 26AS of the assessee, however, the assessee had not shown the corresponding receipts / income in its return of income. The assessee pleaded that it had not undertaken any contract work with the said party and further that neither any amount has been received nor any income accrued to the assessee from M/s. Mass Infrastructure Pvt. Ltd. However, the AO did not agree with the above contention of the assessee and added the total receipts as shown paid by M/s. Mass Infrastructure Pvt. Ltd. and reflected in assessee’s form 26AS amounting to Rs.2,21,31,453/-.

5.

Being aggrieved by the said addition, the assessee preferred appeal before the Ld.CIT(A). During appellate proceedings, the assessee reiterated its submissions and submitted that no amount, whatsoever, has been credited or received or accrued to the assessee from M/s. Mass Infrastructure Pvt. Ltd. The Ld. CIT(A) noted that there was no such evidence available showing that the assessee has received any amount from M/s. Mass Infrastructure Pvt. Ltd., however, taking into consideration that only profit element can be added on the receipts, estimated net profit @8% on

ITA Nos.2422 & 2579/Ahd/2025 [Creative Construction Company] A.Y. 2015-16 - 4 –

the alleged receipts at Rs.17,70,516/- and deleted the remaining addition.

6.

Now, before us, the Revenue has come in appeal agitating the addition of the Ld. CIT(A) in restricting the addition to the extent of @8% of the total receipts shown in Form 26AS, whereas, the assessee has come in appeal contending that there was no justification of even estimating @8% of net profit of the alleged receipts, when the assessee, in fact, has not received any amount from the said party during the year under consideration.

7.

We have heard the rival contentions and gone through the record. The Ld. DR has been fair enough to admit that there was no evidence in the shape of any bank account statement etc. showing that the assessee has received any amount from the said party. The Ld. AR, on the other hand, has submitted that if a third party has booked bogus expenses by showing payment to the assessee, the assessee cannot be burdened with taxes on such alleged bogus expenditure.

8.

Since, there is no evidence on the file that the assessee has undertaken any contract with the said party M/s. Mass Infrastructure Pvt. Ltd., nor there is any evidence that any income has accrued to the assessee during the year under consideration from the said party M/s. Mass Infrastructure Pvt. Ltd., therefore, addition in relation to such an amount cannot be made in the hands

ITA Nos.2422 & 2579/Ahd/2025 [Creative Construction Company] A.Y. 2015-16 - 5 –

of the assessee. In view of this, the impugned addition confirmed by the Ld. CIT(A) @8% of the alleged receipts is ordered to be deleted. The impugned order of the CIT(A) is set aside, the additions made by the AO as well as by the CIT(A) are ordered to be deleted.

9.

In the result, appeal of the assessee stands allowed, whereas, appeal of the Revenue stands dismissed.

This Order pronounced on 20/07/2026 under Rule 34(4) of the ITAT Rules

Sd/- Sd/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 20/07/2026 S. K. SINHA True Copy आदेश क� �ितिल�प अ�े�षत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. 2. ��यथ� / The Respondent. संबंिधत आयकर आयु� / Concerned CIT 3. 4. आयकर आयु�(अपील) / The CIT(A)- �वभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 5. गाड� फाईल / Guard file. 6. आदेशानुसार/ BY ORDER,

उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad

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