ALPHA ENTERPRISES,FARIDABAD vs. INCOME TAX OFFICER, FARIDABAD

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ITA 1407/DEL/2026Status: DisposedITAT Delhi16 April 2026AY 2018-193 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal decided that a lumpsum disallowance of 6% of the alleged bogus purchases would be just and proper, without setting a precedent. The assessee's book entries were rejected to this extent.

What were the facts?

The assessee's purchases of raw material amounting to Rs. 12,09,450/- in AY 2017-18 were treated as bogus under Section 69C of the Act by the lower authorities. The assessee is engaged in battery lead recycling, and while sourcing from unregistered dealers is possible, their sales were not questioned.

What were the issues?

The key issue was whether the purchases of raw material from a specific supplier were indeed bogus, and if so, what should be the quantum of disallowance.

Which sections of the Income-tax Act were involved?

Section 69C,Section 147,Section 144,Section 144B

AI-generated summary — verify with the full judgment below

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

Before: SHRI SATBEER SINGH GODARA

For Appellant: Ms. Rajkumari, CA (VC)
Hearing: 06.04.2026Pronounced: 06.04.2026

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: “SMC” NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER ITA No.1407/Del/2026 Assessment Year: 2018-19 Alpha Enterprises Vs. Income Tax Officer, Plot No. 2, Near Patel CGO Complex, Bhawan NIT Faridabad- 121007 Faridabad, Haryana Haryana PAN: AAOFA4945Q (Appellant) (Respondent) Assessee by Ms. Rajkumari, CA (VC) Department by Sh. Ravi Kant Chaudhary, Sr. DR Date of hearing 06.04.2026 Date of pronouncement 06.04.2026 ORDER This assessee’s appeal for assessment year 2018-19, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s DIN and order no. ITBA/NFAC/S/250/2025-26/1083518583(1), dated 10.12.2025 involving proceedings under section 147 r.w.s. 144 r.w.s. 144B of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties. Case file perused.

2.

It emerges during the course of hearing that the assessee presses for his sole substantive ground on merits challenging both

ITA No.1407/Del/2026

the learned lower authorities’ action treating its purchases of raw material Rs.12,09,450/- in AY 2017-18, sourced from M/s Swastik Enterprise, as bogus ones under section 69C of the Act, in the assessment order dated 13.03.2023, and upheld in the lower appellate discussion. 3. That being the case, both the parties vehemently reiterate their respective stands against and in support of the impugned bogus purchases disallowance. I wish to make it clear that there is no dispute in principle that the assessee is engaged in the business of battery lead recycling all along 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. Various judicial precedents (2025) 173 taxmann.com 592 (Guj.) Ravjibhai Becharbhai Dhamelia vs. ACIT; (2024) 160 taxmann.com 110 (Bom) PCIT Vs. Hitesh Mody (HUF), (2024) 160 taxmann.com 93 (Del) PCIT Vs. Forum Sales (P) Ltd.; (2025) 172 taxmann.com 283 (Bom) PCIT Vs. Kanak Impex (India) Ltd; (2025) 178 taxmann.com 424 (Del. – Trib.) DCIT Vs. Kohinoor Foods Ltd.; and (2025) 177 taxmann.com 836 (Delhi-trib.) DCIT Vs. Tirupati

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ITA No.1407/Del/2026

Matsup (P.) Ltd. have recently decided the instant issue of bogus purchases with divergent views as well. 4. Faced with these peculiar facts, it is thus deemed appropriate in the larger interest of justice that a lumpsum disallowance @ 6% of the assessee’s alleged bogus purchases amounting to Rs.12,09,450/-, would be just and proper with a rider that the same shall not be treated as a precedent. The assessee’s book entries are hereby rejected to the very extent. Necessary computation shall follow as per law. No other ground or argument has been pressed.

5.

This assessee’s appeal is partly allowed in above terms. Order pronounced in the open court on 06th April, 2026.

Sd/- (SATBEER SINGH GODARA) JUDICIAL MEMBER Dated: 16th April, 2026. Pooja Mittal/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi

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