EASWARAMURTHY PRAKASH,COIMBATORE vs. ITO, WARD-1(2), TIRUPUR

ITA 2247/CHNY/2025Status: DisposedITAT Chennai09 March 2026AY 2016-17Bench: SHRI GEORGE GEORGE K (Vice President), SHRI S.R. RAGHUNATHA (Accountant Member)1 pages
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What did the Tribunal hold?

The Tribunal held that while a best judgment assessment is justified in the absence of books of account, the estimation must be reasonable. Given the nature of the garment business and the absence of substantiation, the Tribunal found the 8% estimation too high and the assessee's plea for 2% too low.

What were the facts?

The assessee, engaged in the garment business, failed to file a return of income and maintain books of account for AY 2016-17. The AO reopened the assessment and estimated business income at 8% of bank credits, which was upheld by the CIT(A). The assessee appealed this estimation.

What were the issues?

Whether the estimation of business income at 8% of bank credits by the AO, in the absence of books of account, was justified and reasonable.

Which sections of the Income-tax Act were involved?

Section 144,Section 147,Section 148,Section 254,Section 44AD

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI

Before: SHRI GEORGE GEORGE K & SHRI S.R. RAGHUNATHA

For Respondent: Shri. N. Rajakumar, Addl.CIT
Hearing: 27.01.2026Pronounced: 09.03.2026

PER S.R.RAGHUNATHA, AM: The present appeal of the assessee is directed against the order dated 26.06.2025 passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld.CIT(A)”), arising from the assessment order dated 02.01.2025 passed by the National Faceless Assessment Centre (hereinafter referred to as the “AO”) u/s.144 r.w.s 254 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for t

The order continues below.

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