M/S GLOBALMET INDUSTRIES (P) LTD.,UTTARAKHAND vs. INCOME TAX OFFICER, UTTARAKHAND

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ITA 104/DDN/2026Status: DisposedITAT Dehradun05 August 2026AY 2022-234 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal acknowledged that purchases from unregistered dealers were possible and the assessee's sales were not questioned. Considering the facts and judicial precedents, a lumpsum disallowance of 2% of the alleged bogus purchases was deemed just and proper.

What were the facts?

The assessee company was selected for scrutiny due to substantial purchases from non-filers, raising suspicion of bogus expenses. Despite providing some documentation, the Assessing Officer (AO) made an addition of Rs. 6,46,44,460/-. The CIT(A) dismissed the assessee's appeal.

What were the issues?

The primary issue was the genuineness of purchases from suppliers who were non-filers or had filed meager income. The Tribunal had to decide on the validity of the addition made by the AO for alleged bogus purchases.

Which sections of the Income-tax Act were involved?

Section 69C,Section 143(3),Section 144B,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DEHRADUN “DB” BENCH: DEHRADUN

Before: SHRI SATBEER SINGH GODARA & SHRI MANISH AGARWAL

For Appellant: Shri Somil Agarwal, Adv. &, Shri Deepesh Garg, Adv
For Respondent: Shri Amar Pal Singh, JCIT DR
Hearing: 26.05.2026Pronounced: 05.08.2026

IN THE INCOME TAX APPELLATE TRIBUNAL DEHRADUN “DB” BENCH: DEHRADUN BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER & SHRI MANISH AGARWAL, ACCOUNTANT MEMBER [THROUGH VIRTUAL MODE] ITA No.104/DDN/2026 [Assessment Year : 2022-23] M/s. Globalmet Industries (P.) vs ITO Ltd. Ward-2(2)(1) Vill.- Paiga, Tehsil-Kashipur, Kashipur, Kashipur, Uttarakhand-244713 Uttarakhand PAN-AAICG9459N APPELLANT RESPONDENT Assessee by Shri Somil Agarwal, Adv. & Shri Deepesh Garg, Adv. Revenue by Shri Amar Pal Singh, JCIT DR Date of Hearing 26.05.2026 Date of Pronouncement 05.08.2026 ORDER PER MANISH AGARWAL, AM : The present appeal is filed by the assessee against the order dated 19.12.2025 by Ld. Commissioner of Income Tax (A), National Faceless Appeal Centre (“NFAC”), Delhi [“Ld.CIT(A)”] in Appeal No. NFAC/2021-22/10339183 passed u/s 250 of the Income Tax Act, 1961 [“the Act”] arising from the assessment order dated 26.03.2024 passed u/s 143(3) r.w.s 144B of the Act pertaining to Assessment Year 2022-23.

2.

Brief facts of the case are that the assessee is a company and filed its return of income u/s 139(1) of the Act on 07.11.2022, declaring total income of Rs. NIL (loss INR 2,84,814/-). The case is

ITA No.104/DDN/2026

selected for scrutiny under CASS on the reasons that “Assessee has made substantial purchases from such suppliers who are Non-Filer(s) as compared to turnover shown in GSTR 1 return. There is a possibility that assessee has booked bogus expenses in order to reduce its profit/taxable income. Therefore, the genuineness / correctness of expenses related with these entities may be verified.” Thereafter, various notices were issued to the assessee requesting to furnish details such as copy of financial statement with complete noting and schedules, details of unsecured loan, details of creditors and their supporting evidences, party & quantity wise purchase details etc. In response to the above, assessee has made compliance and submitted copy of financial statement, computation of income, ledger account of purchase, sample purchase invoices, ledger of creditors, ledger of unsecured loan. From the perusal of GST data from Insight Portal, ledger account of purchase, the AO noticed that assessee has made purchased from various parties which has not filed ITR or filed ITR with meager income. Thus the assessee was asked to furnish sample tax invoice alongwith delivery challan of each party and all the purchase bills, delivery challan in respect of purchase made from the counter party. However, assessee simply submitted purchase ledger and Profit & Loss Account and no voucher, freight invoices, were submitted. After considering the details filed, the income of the assessee was assessed u/s. 143(3) r.w.s. 144B of the Income-tax Act at INR 6,46,44,460/-.

ITA No.104/DDN/2026

3.

Against the said order, assessee filed an appeal before Ld. CIT(A) who vide order dated 19.12.2025, dismissed the appeal of the assessee.

4.

Aggrieved by the order of ld. CIT(A), assessee is in appeal before the Tribunal by taking various Grounds of appeal mentioned in the appeal memo.

5.

In Ground of appeal No.2, assessee has challenged both the learned lower authorities’ action of making addition of INR 6,46,44,460/- alleged as bogus u/s 69C of the Act.

6.

Heard the contentions of both the parties at length and perused the material available on record. That being the case, both the parties vehemently reiterate their respective stands against and in support of the impugned bogus purchases disallowance. We wish to make it clear that there is no dispute in principle that the assessee is a company wherein possibility of assessee sourcing its purchases from unregistered dealers per se could not be altogether ruled out as well. And that his corresponding sales have nowhere been questioned in both the lower proceedings. Reliance is placed on the various judicial precedents wherein bogus purchases with divergent views as well were adjudicated. For the sake of clarity, following judicial pronouncements were reproduced as under:- [i] Ravjibhai Becharbhai Dhamelia vs. ACIT (2025) 173 taxmann.com 592 (Guj.); [ii] PCIT Vs. Hitesh Mody (HUF) (2024) 160 taxmann.com 110 (Bom); [iii] PCIT Vs. Forum Sales (P) Ltd. (2024) 160 taxmann.com 93 (Del);

ITA No.104/DDN/2026

[iv] PCIT Vs. Kanak Impex (India) Ltd (2025) 172 taxmann.com 283 (Bom); [v] DCIT Vs. Kohinoor Foods Ltd. (2025) 178 taxmann.com 424 (Del. – Trib.); and [vi] (2025) 177 taxmann.com 836 (Delhi-trib.) DCIT Vs. Tirupati Matsup (P.) Ltd. 7. Faced with these peculiar facts, it is thus deemed appropriate in the larger interest of justice that a lumpsum disallowance @ 2% of the assessee’s alleged bogus purchases amounting to Rs.6,46,44,460/-, would be just and proper with a rider that it will not be taken as precedent. Accordingly, Ground of appeal No.2 raised by the assessee is partly allowed.

8.

Since we have already partly allowed Ground of appeal No.2, the other Grounds of appeal become academic hence, not adjudicated.

9.

In the result, appeal of the assessee is partly allowed.

Order pronounced in the open Court on 05.08.2026.

Sd/- Sd/-

(SATBEER SINGH GODARA) (MANISH AGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Date:- 05.08.2026 *Amit Kumar, Sr.P.S* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT 6. Guard File ASSISTANT REGISTRAR ITAT

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