ACIT, INCOME TAX DEPARTMENT vs. TRESOR SYSTEMS PVT. LTD., DELHI

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ITA 7275/DEL/2025Status: DisposedITAT Delhi05 June 2026AY 2020-216 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(A) erred by not confronting the additional evidence submitted by the assessee with the AO. Therefore, the matter was remanded back to the AO for verification of the assessee's claim regarding expense reimbursements.

What were the facts?

The assessee company declared income, but the AO noted a difference between the declared income and the income appearing in the 26AS statement, leading to an addition. The assessee claimed this difference was due to reimbursements of expenses, which were adjusted against purchase/expense accounts.

What were the issues?

Whether the CIT(A) erred in deleting the addition without confronting the additional evidence with the AO, and whether the income in 26AS represented taxable income or expense reimbursements.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144B,Section 250,Section 194A,Section 194C,Section 194H,Section 194J,Section 194O

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI “C” BENCH: NEW DELHI

Before: SHRI YOGESH KUMAR U.S & SHRI MANISH AGARWAL

For Appellant: Shri Aditya Kumar Garg, Adv. &, Shri Aditya Ajgaonkar, Adv
For Respondent: Shri Om Prakash, Sr. DR, Shri Aditya Kumar Garg, Adv. &, Shri Aditya Ajgaonkar, Adv
Hearing: 17.03.2026Pronounced: 05.06.2026

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “C” BENCH: NEW DELHI BEFORE SHRI YOGESH KUMAR U.S, JUDICIAL MEMBER & SHRI MANISH AGARWAL, ACCOUNTANT MEMBER ITA No.7275/Del/2025 [Assessment Year : 2020-21] ACIT vs Tresor Systems Pvt. Ltd. 192, C.R. Building, E-44, Phase-II, Okhla Industrial Area, New Delhi-110020. I.P. Estate, ITO, New Delhi-110002 PAN-AAACY3514A APPELLANT RESPONDENT Revenue by Shri Om Prakash, Sr. DR Assessee by Shri Aditya Kumar Garg, Adv. & Shri Aditya Ajgaonkar, Adv. Date of Hearing 17.03.2026 Date of Pronouncement 05.06.2026 ORDER PER MANISH AGARWAL, AM : The present appeal is filed by the Revenue against the order dated 15.09.2025 by Ld. Commissioner of Income Tax (A), National Faceless Appeal Centre (“NFAC”), Delhi [“Ld.CIT(A)”] in Appeal No. NFAC/2019-20/10182256 passed u/s 250 of the Income Tax Act, 1961 [“the Act”] arising from the assessment order dated 28.09.202 passed u/s 143(3) r.w.s. 144B of the Act pertaining to Assessment Year 2020-21.

2.

Brief facts of the case are that the assessee company has filed its return of income on 31.01.2021, declaring total income at INR 13,42,09,990/-. The return of income was processed and case was taken for complete scrutiny. The AO observed that there is difference

ITA No.7275/Del/2025

between the income offered by the assessee and the income appearing in 26AS statement of the assessee where TDS was deducted u/s 194A, 194C, 194H and 194J of the Act. The assessee filed the reconciliation statement stating that due to the GST provisions, distributors have asked the assessee to raise the invoices with respect to various expenses reimbursed by them and while making payments they deducted TDS. However, the assessee has credited the said income in the respective expenses/purchases account and thus, the respective expenses or purchases have been claimed by the reduced amount to the extent of such reimbursement and in this way, the figures appearing in 26AS statements got disclosed and has been offered for tax. However, the AO failed to understand the accounting treatment and made the addition of the differential amount of INR 7,81,00,507/- between the income appearing in 26AS statement and income already credited in Profit & Loss Account at additional income of the assessee. Accordingly, the total income of the assessee was assessed at INR 21,23,10,497/-.

3.

Against the said order, the assessee filed an appeal before Ld. CIT(A) who vide impugned order dated, 15.09.2025, partly allowed the appeal of the assessee and deleted the addition made by the AO.

4.

Aggrieved by the order of Ld.CIT(A), Revenue is in appeal before the Tribunal by taking following Grounds of appeal: 1. “Whether on the facts and in the circumstances of the case and in law the CIT(A)/NFAC has erred in deleting the addition of total amounting to Rs. 7,81,00,507 made by the Assessing Officer on account of receipts shown in form 26AS by Redington India Ltd and Ingram Micro India Pvt. Ltd on account of tax deducted at source by

ITA No.7275/Del/2025

these two companies under section 194H, 194J and section 1940 but the relevant income was not shown by the assessee company in the return of Income. 2. Whether on the facts and in the circumstances of the case and in law the CIT(A)/NFAC has erred in deleting the addition of Rs. 4,51,03,337 made on account of receipts shown in form 26AS of the assessee company by Redington India Ltd on account of tax deducted at source by the company under section 194H, and the relevant income was not reflected in the Return of Income by the assessee. 3. Whether on the facts and in the circumstances of the case and in law the CIT(A)/NFAC has erred in deleting the addition of Rs.1,38,28,262 made on account of receipts shown in form 26AS of the assessee company by Redington India Ltd on account of tax deducted at source by the company under section 194J, and the relevant income was not reflected in the Return of Income by the assessee. 4. Whether on the facts and in the circumstances of the case and in law the CIT(A)/NFAC has erred in deleting the addition of Rs. 1,91,68,908 made on account of receipts shown in form 26AS of the assessee company by Ingram Micro India Pvt. Ltd on account of tax deducted at source by the company under section 1940, and the relevant income was not reflected in the Return of Income by the assessee. 5. The appellant craves, leaves to add, amend the above grounds of appeal.”

5.

Before us, Ld. Sr. DR for the Revenue vehemently supported the order of AO and submits that assessee has filed additional evidences before Ld.CIT(A) which is evident from the appellate order and such evidences are placed at Paper Book pages 270 to 287. Ld. Sr. DR submits that Ld.CIT(A) has not called for the Remand Report from the AO on the additional evidences so filed by the assessee however, after considering these evidences, has deleted the additions made by the AO. He, therefore, requested that matter may be sent back to the AO for verification of the additional evidences as no opportunity was provided to the Revenue by the ld. CIT(A).

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6.

On the other hand, Ld.AR for the assessee submits that the assessee is authorized re-seller of Apple products. The goods were purchased from the local distributors namely Redington (India) Pvt. Ltd. and M/s Ingram Micro India Ltd., and certain expenses were incurred on behalf of the principal were reimbursed by them. Under GST Act, every payment has to be backed by a valid GST invoice and therefore, on the behest of the distributor, the assessee has raised invoices for reimbursement of marketing expense, rent etc. on which GST was also charged. The distributors while making the payment make TDS as per law. Ld.AR submits that said reimbursement was credited to the respective expenses / purchases account and accordingly, the purchase or expenses was reduced to that extent while debited to the P&L Account. Thus, ultimately this reimbursement is offered for tax by way of reduction in purchases or expenses claimed. As per ld. AR, during the course of appellate proceedings before the Ld. CIT(A), assessee has filed few copies of such invoices as additional evidence. Ld. AR submits that Ld. CIT(A) after appreciating the facts and the documents so field, has deleted the additions which order deserves to be uphold. He prayed accordingly.

7.

Heard the contentions of both the parties at length and perused the material available on record. At the outset, it is observed that the sole issue in this appeal whether the income appearing in 26AS statement was included in the total income declared by the assessee. Claim of the assessee was that it relates to the reimbursement of expenses which was directly credited to the respective expenses/

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purchases account and net amount of such expenses / purchases was claimed in the P&L A/cs. Therefore, the income reflected in 26AS statement has duly been offered for tax and therefore, no addition is required to be made. In support of this contention, the assessee has filed additional evidences in the shape of bills issued and vouchers made which are placed at pages 269 to 287 of the Paper Book filed by the assessee. The ld. CIT(A) without confronting these additional evidences filed by the assessee to the AO has allowed the relief to the assessee which is gross violation of principal of natural justice. In this regard reliance is placed on the judgment of Hon’ble Jurisdictional High Court in the case of Commissioner of Income Tax (Central)-I vs Manish Build Well Pvt. Ltd. wherein vide order dated 15.11.2011 the Hon’ble High Court has held that “Revenue should be controverted with the additional evidences and Remand Report must be called for.”

8.

Under these circumstances and by respectfully following the judgement of hon’ble Jurisdictional High Court in the case of Manish Buildwell Pvt. Ltd. (supra), we remand the matter back to the file of AO with the directions to verify the contention of the assessee that the income appearing in 26AS statement is on account of reimbursement of expenses and such amounts were reduced from the expenses/ purchases claimed and net amount was claimed as expenses/ purchases. On verification, if the contention of the assessee is found correct, no separate addition is required to be made. With these directions, all Grounds of appeal raised by the revenue are allowed for statistical purposes.

ITA No.7275/Del/2025

9.

In the result, the appeal of the revenue is allowed for statistical purposes.

Order pronounced in the open Court on 05.06.2026.

Sd/- Sd/- (YOGESH KUMAR U.S) (MANISH AGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER

Date:-05.06.2026 *Amit Kumar, Sr.P.S*

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