What did the Tribunal hold?

The Tribunal found the CIT(A)'s 9% profit calculation to be too high and the assessee's 2% to be low, considering the mining business typically yields around 3% profit. Therefore, the Tribunal directed that profit be calculated at 3% of total turnover.

The assessee appealed against the CIT(A)'s order which treated all credits as business receipts and calculated profit at 9%. The assessee argued that their actual profit was only 2% of turnover.

What were the issues?

Whether the CIT(A) erred in calculating business profits at 9% when the actual profit was 2%, and whether the order was passed without affording a reasonable opportunity of being heard.

Sunder Marketing Associates vs ITO | ITAT Delhi 2026

Income Tax Appellate Tribunal, DELHI BENCH: ‘H’ NEW DELHI

Before: SH. SATBEER SINGH GODARA & SH. KRINWANT SAHAY

Hearing: 16.07.2026Pronounced: 16.07.2026

1 . IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: ‘H’ NEW DELHI BEFORE SH. SATBEER SINGH GODARA, JUDICIAL MEMBER AND SH. KRINWANT SAHAY, ACCOUNTANT MEMBER

I.T.A. No.4083/DEL/2025 (A.Y 2017-18) Sunder Marketing ITO Associates F-8, Second Vs. Circle – 34 (1) Floor, Parvana Vihar, Delhi Apartment, Sector-9 Rohini, Delhi Appellant Sh. Parikshit Aggarwal, CA (Virtual) Respondent Sh. Bhopal Singh, CIT DR Date of Hearing 16.07.2026 Date of Pronouncement 16.07.2026 ORDER PER KRINWANT SAHAY AM

Appeal in this case has been filed by the assessee against the order dated 31.10.2023 passed by the Ld. CIT(A)/NFAC, Delhi for the A.Y. 2017-18. Grounds of appeal are as under :-

That on the facts, circumstances and legal position of the case, Worthy CITIA). NFAC in Appeal No. CIT (A), Delhi- 12/11160/2019-20 has erred in passing order dtd.

2 . 31.10.2023 in contravention of provisions of S. 250 of the Income Tax Act, 1961(hereinafter referred to as "Act").

That on facts, circumstances and legal position of the case, Worthy CITIA) has erred in making additions considering all credits Rs.347,70,77,681/- treated as business receipts/turnover of the assessee and calculated the profits 9% le Rs.31,29,36,990 even when the actual business profits, as per the books accounts, amounts only 2% of the turnover/receipts.

That on facts, circumstances and legal position of the case, the orders passed by Worthy CIT(A) deserves to be quashed since the same have been passed without affording reasonable opportunity of being heard to the appellant.

That the appellant craves leave for any addition, deletion or amendment in the grounds of appeal on or before the disposal of the same.

It has come to the notice of the registry that there is a delay in filing of the appeal before the Tribunal. The assessee has already filed an application alongwith affidavit for condonation of delay which is reproduced as under :-

3 .

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6 .

Keeping in view the facts narrated in the application, we are inclined to condone the delay. The Ld. DR stated that the matter may be decided on merit for condonation issue.

During proceedings before us the Ld. Counsel for the assessee submitted that the Ld. CIT(A) has made addition considering all credits of Rs.347,70,77,681/- treating it as business receipt and calculated profit @ 9% whereas the actual business profit was only @ 2% of the turnover.

Per contra the Ld. DR relied on the order of the Ld. CIT(A).

We have considered the findings given by the Ld. CIT(A) in the appellate order and we have considered the arguments made before us by the ld. Counsel for the assessee as well as by the Ld. DR. We are of this considered view that in the mining business over all profit is around @ 3%, therefore, the profit declared by the assessee @2% of the turnover / receipts is low but at the same time the calculation @ 9 % by the Ld. CIT(A) is also very high, therefore, in our considered view @ 3% of the total turnover / receipts will serve the purpose of justice. Accordingly, @3% of the total turnover/ receipts is treated as profit in this business, the AO may calculate the profit

7 . accordingly. Thus, assessee’s appeal on this issue is partly allowed. 7. In the result, the appeal filed by the assessee is partly allowed. Order pronounced in open Court on 16.07.2026.

Sd/- Sd/- (SATBEER SINGH GODARA) (KRINWANT SAHAY) JUDICIAL MEMBER ACCOUNTANT MEMBR Dated : 16/07/2026 *Neha Sr. PS* Copy forwarded to : 1. Appellant 2. Respondent 3. CIT 4. CIT (Appeals) 5. DR: ITAT

ASSISTANT REGISTRAR ITAT NEW DELHI

SUNDER MARKETING ASSOCIATES,DELHI vs. ITO, CIRCLE 34(1), DELHI, DELHI

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