DEPUTY COMMISSIONER OF INCOME TAX, CHENNAI vs. ALINA PRIVATE LIMITED, CHENNAI

आदेश/ O R D E R

PER M. BALAGANESH, AM:

(ii) The Ld.CIT(A) has directed the AO to delete the addition of Rs.10,83,96,474/- made by the assessee in their Return of Income for AY 2023-24 towards unaccounted stock on the grounds that the addition of this amount in AY 2022-23 was confirmed by the CIT(A) order in DIN ITBA/APL/S/250/2025- 26/1076458566(1) dated 26.05.2025, without considering the fact that the assessee has not extinguished their right to appeal against the decision of the Ld.CIT(A) on this issue for AY 2022- 23 and hence the issue has not reached finality.

5.3.1 During the course of search on 17.01.2023, suppression of stock, inter-alia, for the period 31.03.2022 was found at Rs.11,86,50,933/-. While agreeing with the said findings in principle, the appellant offered Rs.10.84 Crores for the subject assessment year as additional income in the computation of total income and claimed that balance of non-moving stock of Rs.1.02 Crores was consumed into production after the date of search. However, going by the search findings, the total suppression of Rs.11.86 Crores was considered for addition by the Assessing Officer in the assessment for the Asst. Year 2022-23 and the appeal filed by the appellant was decided upholding the treatment given by the Assessing Officer vide DIN & Order No: ITBA/APL/S/250/2025-26/1076458566(1) dated 26/05/2025. Since the total quantum of suppression of stock amounting to Rs.11.86 Crores was taxed and confirmed for the Asst. Year 2022-23, the protective addition of Rs.1.02 Crores made by the Assessing Officer for the 5 -: subject assessment year is directed to be deleted. Accordingly, the ground no.2 is allowed. 5.4. In all the additional / alternate grounds, it is the claim of the appellant that since suppression of closing stock was found to the extent of Rs.11,86,50,933/- the addition be restricted to such amount in any of the years, i.e., Asst. 2022-23 or 2023- 24, and if the addition was confirmed as on 31.03.2022, then the admission made by them in the subject assessment year be reduced by the confirmed amount of closing stock.

5.4.1 As was brought out earlier, the appellant has admitted Rs.10,83,96,474/- towards provision for obsolescence and slow moving and movement in inventories. As the total suppression of stock as on 31.03.2022 made out during the course of search was added and confirmed for the assessment year 2022-23, the admission made by the appellant to this effect has to be reduced. Therefore, the AO is directed to reduce the income admitted for the subject assessment year by Rs.10,83,96,474/-. Accordingly, the additional / alternate grounds raised by the appellant are allowed.

Aggrieved, Revenue is in appeal before us for assessment year 2023-24.

6. In view of the above letter, we hold that the Revenue’s appeal for assessment year 2023-24 need to be dismissed as infructuous in view of the assessee’s undertaking withdrawing its appeal for assessment year 2022-23. Either way, we find the income has been added and considered in assessment year 7 -: 2022-23 itself by the Revenue, which had been accepted by the assessee now. Since the addition has been already made in assessment year 2022-23, there is no scope for making any addition in assessment year 2023-24 for the very same sum. Hence, the income offered by the assessee in assessment year 2023-24 on the impugned issue need to be restored. The assessee is also directed to duly bring to the notice of this Tribunal as and when its appeal for assessment year 2022-23 in is listed for hearing stating that the same need to be withdrawn.

Order pronounced in the open court on 24th October, 2025 at Chennai.