ENSEMBLE INFRASTRUCTURE INDIA LTD,MUMBAI vs. INCOME TAX OFFICER 6(2)(1), MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH MUMBAI BEFORE HON’BLE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER ITA No. 7939/Mum/2025 (Assessment Year: 2011-12) Ensemble Infrastructure Vs. Income Tax Officer India Ltd., 6(2)(1), One World Centre, 3rd Floor, Room No. 510, 5th Tower 2B, South Annexe, Floor, Aayakar Bhawan, Mumbai, Mumbai, Maharashtra- 400013 Maharashtra- 400020 PAN/GIR No. AACCE3555F (Assessee) (Revenue) Assessee by Shri Jatin Shah, CA Revenue by Shri Brajendra Kumar (Sr. DR) Date of Hearing 16.06.2026 Date of Pronouncement 14.07.2026 आदेश / ORDER PER SANDEEP GOSAIN, JM: The present appeal has been filed by the assessee challenging the impugned order dated 19.09.2025 passed u/s 250 of the Income Tax Act, 1961 ('the Act'), by the CIT(A) for the assessment year 2011-12. The following grounds raised by assessee are reproduced below:- i. The learned CIT(A) erred in confirming the addition of Rs. 47,11,295 towards alleged bogus purchases without properly

2 ITA No. 7939/Mum/2024 (Ensemble Infrastructure India Ltd.) appreciating the facts of the case and the documentary evidence placed on record. ii. The learned CIT(A) failed to appreciate that the Appellant had furnished complete primary evidences, including purchase invoices, supplier ledgers, delivery challans, VAT registration details, bank statements, and quantitative stock records, all of which were filed during assessment and verified by the Assessing Officer. iii. The learned CIT(A) erred in upholding the disallowance merely on the basis of non-service of notices and third-party information, without conducting any independent verification and without providing opportunity of cross-examination. iv. The learned CIT(A) erred in confirming the disallowance despite the fact that the suppliers were registered under VAT/CST laws and payments were made through account-payee cheques. v. The learned CIT(A) erred in confirming the disallowance of the entire purchase value instead of restricting any addition, if at all, only to a possible profit element. vi. The learned CIT(A) erred in upholding a disallowance which results in an abnormal gross profit margin of 70.90%, which is unrealistic and not achievable in the Appellant's tine of business. vii. The learned CIT(A) erred in confirming the disallowance without appreciating that corresponding sales have been accepted, and in a manufacturing business, sales cannot be effected without purchases.

3 ITA No. 7939/Mum/2024 (Ensemble Infrastructure India Ltd.) 3. I have heard the Ld. Counsels from both the parties, perused the material placed on record, judgments cited before me and also the orders passed by the Revenue Authorities. 4. From the record, I noticed that the addition in this case was made by Assessing Officer on account of the fact that the Assessing Officer got information from Sales Tax Department that the parties from whom the assessee had made purchases, were providing bogus billing i.e. providing bills without actual delivery of goods. Therefore, Assessing Officer was of the view that the assessee had booked commission/expenses from these parties and thus made addition under Section 69C of the Income Tax Act. Although the said additions were challenged before Ld. CIT(A), but Ld. CIT (A) was of the view that the addition ought to have been made as business income instead of addition under Section 69C of the Income Tax Act. 5. After going through the entire facts of the present case, I noticed that the AO got information from the office of DGIT (Inv.) Mumbai, that the assessee had debited bogus purchases from M/s. Balaji Trading Company, Bhatiya Agencies, Amar Enterprises. Therefore, in order to verify the said purchases, respective notices under Section 133(6) of the Act were issued on all the three parties by the AO,

4 ITA No. 7939/Mum/2024 (Ensemble Infrastructure India Ltd.) however, all the notices issued by the AO were returned back with the remarks “left”. Thus, on account of non- compliance from the parties, the AO could not verify the purpose of making payment by the assessee. Whereas, on the contrary, it was specifically argued by the Ld. AR that the assessee had made payments by cheques to the parties, however, in my view, only making payment by cheque to the parties does not make the purchases as genuine unless and until recipient of the payments confirms that the payments was towards the “purpose” for which it was made. 6. The assessee had not placed on record any documentary evidence in order to prove the actual delivery/physical delivery of the goods allegedly purchase by the assessee, therefore, in my view AO righty considered the alleged purchases made by the assessee as accommodation entries. Even Ld. CIT(A) after appreciating the facts of the present case has rightly concluded that the impugned expenses although supported by Bills, but there was no conclusive proof of actual delivery or physical delivery of the goods, therefore, the said amount was rightly considered as “business income” instead of addition under Section 69C of the Income Tax Act on account of the fact that assesse had booked expenses from bogus bills providers, as no evidence

5 ITA No. 7939/Mum/2024 (Ensemble Infrastructure India Ltd.) in support of goods being supplied against the invoice have been submitted. 7. Even otherwise, no new facts or circumstances have been brought before me in order to controvert or rebut the factual findings so as to recorded by the AO or by Ld. CIT(A) therefore, I see no reason to interfere into or to deviate from the findings so recorded by Ld. CIT(A). 8. Therefore, considering the entirety of the facts and circumstances as mentioned above, grounds raised by the assessee stands dismissed. 9. In the result appeal filed by the assessee stands dismissed.

Order pronounced in the open court on 14.07.2026

Sd/- (SANDEEP GOSAIN) JUDICIAL MEMBER Mumbai, Dated 14/07/2026 Z.U., PS

6 ITA No. 7939/Mum/2024 (Ensemble Infrastructure India Ltd.) आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : अपीलार्थी / The Assessee 1. प्रत्यर्थी / The Respondent. 2. संबंधित आयकर आयुक्त / The CIT(A) 3. आयकर आयुक्त(अपील) / Concerned CIT 4. धिभागीय प्रधतधिधि, आयकर अपीलीय अधिकरण,मुम्बई/ DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. 6. आदेशानुसार/BY ORDER, सत्याधपत प्रधत //True Copy//

उि/सहायक िंजीकार ( Asst. Registrar) आयकर अिीिीय अतिकरण, मुम्बई / ITAT, Mumbai