SAMEX OVERSEAS,DUMAS ROAD vs. CRICLE 2(1)(1), MAJURAGATE

ITA 440/SRT/2026Status: DisposedITAT Surat23 September 2026AY 2019-204 pages
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What did the Tribunal hold?

The Tribunal noted that the assessee had provided details of tax invoices, payment, and ledger account entries, along with GST paid. The Department had accepted the corresponding sales. While the supplier was declared untraceable, the Tribunal found it appropriate to accept the assessee's alternate plea. The Tribunal directed the AO to estimate a 6% profit on the purchase amount, which was found to be Rs.1,88,800/- based on records, not Rs.2,66,000/- as initially stated. The reasoning was that since the sales were accepted and evidence of purchase was provided, a profit estimation was more appropriate than a full disallowance. The ratio is that where purchase evidence is partially established but the supplier is untraceable, a profit estimation on the purchase amount is a reasonable approach, citing the Gujarat High Court in Surya Impex. The issue of whether Section 69C was correctly invoked was implicitly addressed by moving to a profit estimation approach. The Tribunal did not expressly leave any issue undecided.

What were the facts?

The assessee, Samex Overseas, filed its return of income for Assessment Year 2019-20 on 25/10/2019, declaring a total income of Rs.9,68,879. Following a notice under Section 148, the Assessing Officer (AO) made an addition of Rs.2,66,000 under Section 69C of the Income Tax Act, 1961, treating purchases made by the assessee as bogus. The assessee appealed to the Commissioner of Income Tax (Appeals) - National Faceless Appeal Centre (NFAC), who dismissed the appeal, confirming the AO's order. The assessee then filed an appeal before the Income Tax Appellate Tribunal (ITAT).

What were the issues?

1. Whether the addition of Rs.2,66,000/- under Section 69C of the Income Tax Act, 1961, as unexplained expenditure, was wrongly confirmed by the CIT(A)? (Question of law and fact, turning on Section 69C). - Assessee's contention: The AO invoked incorrect provisions as the case does not fall under Section 69C. Documentary evidence, including tax invoices, bank payments, books of accounts, and GST details, was provided to the AO and CIT(A) to establish the purchases. In the alternative, if the addition is sustained, profit should be estimated at 6% as per the Gujarat High Court decision in Surya Impex. - Revenue's contention: The party from whom the assessee purchased is not traceable, and the assessee provided no such details to the AO or CIT(A). Relied on the assessment order, CIT(A) order, and the Bombay High Court decision in PCIT v. Kanak Impex (India) Ltd.

Which sections of the Income-tax Act were involved?

Section 148,Section 69C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, SURAT BENCH, SURAT

Before: MS. SUCHITRA KAMBLE & SHRI B.M. BIYANI

For Respondent: Shri Ashish Kumar, Sr. DR
Pronounced: 23.09.2026

PER : SUCHITRA KAMBLE, J M:

The appeal filed by the assessee is against the order passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC) [in short “CIT(A)”] dated 22.01.2026 for the Assessment Year (in short “AY”) 2019-20. 2. The assessee has raised the following grounds of appeal: “1.On the facts and circumstances of the case, the learned CIT(A) has wrongly confirmed the addition u/s 69C of 2,66,000/-. 2.The ID CIT(A) should have considered the submissions & evidences made before the

The order continues below.

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