AL-AALI EXPORTS PVT LTD,DELHI vs. DCIT,CC-30, DELHI

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ITA 8710/DEL/2025Status: DisposedITAT Delhi19 May 2026AY 2020-215 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that additions for the earlier assessment years (2020-21 & 2021-22) based on extrapolation were not justifiable. For the later assessment years (2022-23 & 2023-24), the Tribunal allowed a net profit element on the detected unaccounted sales instead of the entire sales addition.

What were the facts?

The assessee's appeals concerned additions of alleged unaccounted sales for assessment years 2020-21 to 2023-24, based on a search action. For the earlier years (2020-21 & 2021-22), additions were made based on extrapolation, while for the later years (2022-23 & 2023-24), additions were based on actual detected sales.

What were the issues?

The primary issues were the justification of additions of alleged unaccounted sales based on extrapolation in earlier years and the method of taxation (full sales vs. net profit) for sales detected during a search in later years.

Which sections of the Income-tax Act were involved?

Section 148,Section 147,Section 143(3)

AI-generated summary — verify with the full judgment below

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

Before: SHRI SATBEER SINGH GODARA & SHRI NAVEEN CHANDRA

For Appellant: Shri Amit Goel, CA, Shri Pranav Yadav, Adv
For Respondent: Ms. Kranti, CIT DR
Hearing: 12.05.2026Pronounced: 19.05.2026

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: “G” NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER & SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA Nos. 8710, 8711, 8712 & 8713/Del/2025 Assessment Year: 2020-21, 2021-22, 2022-23 & 2023-24 Vs. Deputy Al-Aali Exports Pvt. Ltd. Commissioner of First Floor, 5, First Floor, 5 Income Tax Bazar Lane Bengali Market Central Circle-30 Delhi- 110001 E-2, ARA Centre, Jhandewalan Extension New Delhi- 55 PAN: AAHCM0816E (Appellant) (Respondent) Assessee by Shri Amit Goel, CA Shri Pranav Yadav, Adv. Department by Ms. Kranti, CIT DR

Date of hearing 12.05.2026 Date of pronouncement 19.05.2026

ORDER PER SATBEER SINGH GODARA, JM: This assessee/appellant, M/s Al-Ali Exports Private Ltd.’s four appeals ITA Nos. 8710 to 8713/Del/2025, arise against the Commissioner of Income Tax (Appeal)-30 [in short, “CIT(A)”], New Delhi’s as many DINs & Order Nos.ITBA/APL/M/250/2025-26/1082940747(1), ITBA/APL/M/ 250/2025-26/1082940985(1), ITBA/APL/M/250/2025-

ITA No. 8710 to 8713/Del/2025 26/1082941768(1) & ITBA/APL/M/250/2025- 26/1082941972(1), all dated 24.11.2025, involving proceedings u/s 148 r.w.s 147 (A.Ys. 2020-21 & 2021-22) and u/s 143(3) of the Income Tax Act, 1961; hereinafter referred to as ‘the Act’ for A.Y.2022-23 & 2023-24; respectively.

Heard both the parties. Case files perused.

2.

It transpires during the course of hearing that the assessee/appellant herein is aggrieved against bot the learned lower authorities’ respective assessment and lower appellate findings on identical lines adding the alleged unaccounted sales of Rs. 3,29,96,874/-, Rs. 3,85,55,960/-, Rs. 26,92,38,738/- & Rs. 3,36,59,980/-; assessment year wise, respectively, in its hands. They have admittedly proceeded on the bases of the department’s search action carried out in the asessee’s case on 03.01.2023 allegedly detecting its unaccounted sales in the regular business activity of buffalo meat products etc.

3.

It is in this factual backdrop that the tribunal hereby notices from a combined perusal of the case records that 2 | P a g e

ITA No. 8710 to 8713/Del/2025 the learned departmental authorities had come across actual evidence of the assessee’s unaccounted sales in the assessment year 2022-23 and 2023-24 only, indicating sums of Rs. 24,11,786/- and Rs. 2,33,39,943/-; respectively. There is further no quarrel between the parties that they after proceeded to make the impugned additions in all these four years based on extrapolation bases after setting into motion section 148/147 proceedings in the twin former and added the entire sales unearthed during search in the latter twin assessment years; as the case may be. This is what leaves the assessee aggrieved.

4.

We next notice that the first and foremost issue which arises for our apt adjudication in the former twin assessment years is that of correctness of the impugned identical addition of unaccounted sales based on extrapolation method. We wish to clarify here that the same is admittedly not based on any seized material whatever unearthed during search or the detailed inquiries carried out thereafter. That being the clinching case, learned counsel quotes Sampark Laminators Pvt

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ITA No. 8710 to 8713/Del/2025 Ltd. vs DCIT Central Circle-19 in ITA No. 6111/Del/2025, decided on 20.03.2026 that such a method is not justifiable going by Zohra The Emporium 372 ITR 381(Del). We thus reject the Revenue’s vehement contentions supporting the impugned unaccounted sales addition in these former twin assessment years in question in very terms. The assessee succeeds in its appeals ITA Nos. 8710 & 8711/Del/2025 therefore.

5.

Next comes the assessee’s latter twin appeals ITA Nos. 8712 & 8713/Del/2025 in assessment years 2022- 23 & 2023-24. Learned counsel pleads very fairly that the impugned addition of unaccounted sales is very much based on the evidence gathered during the case of search. His only contention is that only a net profit element thereof could have been added which read 2.64% & 1.78% as per its books of accounts. This clinching factual position has gone unrebutted from the Revenue side. We thus take into account totality of all these facts and circumstances to conclude that the lumpsump NPA estimation @ 3% in both these latter assessment years; qua the alleged unaccounted sales actually detected

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ITA No. 8710 to 8713/Del/2025 during search than the entire addition herein; would be just and proper with a rider that the same shall not be treated as a precedent. The Revenue’s vehement contentions stand partly upheld to the very extent. Necessary computation shall follow as per law.

6.

These assessee’s four appeals ITA Nos. 8710 & 8711/Del/2025 are allowed and ITA Nos. 8712 & 8713/Del/2025 are partly allowed in above terms. A copy of this common order be placed in the respective case files. Order pronounced in the open court on 19.05.2026 .

Sd/- Sd/- (NAVEEN CHANDRA) (SATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 19.05.2026 Pooja Mittal, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi

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