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Facts
The assessee, engaged in food-grain trading, was alleged to have obtained accommodation purchase entries from an Aartia for Rs. 53.43 Lacs. The Assessing Officer (AO) added this amount to the assessee's income. The CIT(A) confirmed the assessment.
Held
The Tribunal noted that the assessee advanced a sum to the Aartia, who then purchased and sold goods on the assessee's behalf. The assessee neither took delivery nor sold goods, and no consideration was exchanged with the Aartia. The net surplus of Rs. 3.81 Lacs was disclosed.
Key Issues
Whether the addition made by the AO on account of alleged bogus purchase entries, confirmed by CIT(A), is sustainable when the transaction was handled by an Aartia.
Sections Cited
147, 144B, 68, 115BBE
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Income Tax Appellate Tribunal, “DB” BENCH, AGRA
Before: HON’BLE SHRI SATBEER SINGH GODARA, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM
(िनधा�रणवष� / Assessment Year: 2018-19) Anju Agarwal Income-tax Officer, बनाम/ D-26, Kamla Nagar Ward 2(1)(1), Agra. Vs. Agra (UP). �थायीलेखासं./जीआइआरसं./PAN/GIR No. AWTPA-4297-L (अपीलाथ�/Appellant) : (��थ� / Respondent) अपीलाथ�कीओरसे/ Appellant by : Sh. K.K. Jain, Adv. – Ld. AR ��थ�कीओरसे/Respondent by : Sh. Shailender Shrivastava, - Ld. Sr. DR सुनवाईकीतारीख/Date of Hearing : 21-02-2025 घोषणाकीतारीख /Date of Pronouncement : 23-04-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeals by assessee for Assessment Years (AY) 2017-18 and 2018-19 arise out of separate orders of first appellate authority. First, we take up appeal for AY 2017-18 which arises out of an order passed by learned Commissioner of Income Tax (Appeals), NFAC, Delhi [CIT(A)] on 30-09-2024 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 147 r.w.s. 144B of the Act on 11-02-2022. The assessee is stated to be engaged in trading of food-grains. In the assessment order, Ld. AO alleged that the assessee obtained accommodation purchase entry from M/s Umesh Kumar Vivek Kumar (managed by Shri Ashok Kumar Gupta) for Rs.53.43 Lacs. The assessee did not carry out any other transaction with any other entity. The Ld. AO, after adjusting returned income of Rs.3.81 Lacs, added the differential of Rs.49.62 Lacs to the income of the assessee u/s 68 r.w.s. 115BBE. The Ld. CIT(A) confirmed the assessment against which the assessee is in further appeal before us.
From the case records, it emerges that the assessee has carried on food-grain business through aartia M/s Umesh Kumar Vivek Kumar prop. Shri Vivek Kumar Gupta. For the said purpose, the assessee advanced certain sum to that entity and that entity, in turn, purchased the goods first and then sold the goods on behalf of the assessee. The assessee has neither taken the delivery of the goods nor sold the goods and all the transactions of sale and purchase has been done by that entity only. No purchase / sale consideration has been paid to / from the aartia. The assessee has only received net surplus of Rs.3.81 Lacs which has duly been disclosed in the return of income. On these facts, no allegation of bogus sale or purchase could be sustained against the assessee. Accordingly, by deleting the impugned addition, we allow the appeal on merits. Delving into other grounds has been rendered mere academic in nature. The appeal stand allowed.
Facts as well as issues in AY 2018-19 are quite identical. Accordingly, our adjudication as above shall mutatis mutandis apply to this appeal also.
Both the appeals stand allowed. Order pronounced u/r 34(4) of Income Tax (Appellate Tribunal) Rules, 1963.