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Judgment
PER VIKAS AWASTHY, JM:
This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short ‘the CIT(A)’] dated 26.11.2025, for Assessment Year 2019-20.
Shri Manoj Kumar, representing the department submits that the CIT(A) has deleted addition of Rs.25,03,200/- made by the Assessing Officer (AO) on account of accommodation entries taken by the assessee from M/s Trinity Overseas. The Id. DR submitted that assessment for AY 2019-20 in case of the assessee was reopened and notice u/s.148 of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') was issued to the assessee on the basis of information received that Shri Gurdeep Singh Kartar Singh proprietor M/s. Trinity Overseas (India) is providing bogus accommodation entries and the assessee one of the beneficiary. Thus, on the basis of said information, assessment in the case of assessee was made u/s.147 of the Act. Since, the assessee failed to furnish any documentary evidence in compliance of statutory notices, the AO made addition of Rs.25,03,200/-. The CIT(A) deleted the addition without appreciating facts on record and the information received by the AO.
Per contra, Shri Rohit Agarwal appearing on behalf of the assessee vehemently supporting the impugned order stated that during the period relevant to assessment year under appeal, the assessee has never entered into any transaction with M/s Trinity Overseas (India). The assessee is engaged in the business of manufacturing and sale of bed sheets within India and has never made any exports outside India. Therefore, there is no question of claiming any duty drawback.
Both sides heard, orders of the authorities below examined. The AO has reopened assessment on the basis of information flagged by the Board. The AO in the assessment order records that the assessee has made transaction amounting to Rs.25,03,200/- with Gurdeep Singh Kartar Singh. On the contrary, the stand of the assessee is that the assessee has never made any monetary transaction with M/s Trinity Overseas (India), proprietor Gurdeep Singh Kartar Singh during the relevant period. The case of Revenue is that the assessee has obtained accommodation entries with regard to duty drawback benefit. Whereas, the stand of assessee is that the assessee is not engaged in export of goods out of India, therefore, question of claiming any duty drawback does not arise. The CIT(A) has deleted the addition by observing as under:-
“I have carefully considered the facts of the case, and is of view that AO has not been able to substantiate the information available and its linkage with the appellant. Even the PAN mentioned in the information is not that of the appellant. Moreover, the information in STR pertains to export bills whereas appellant has no turnover of export.”
The Revenue has failed to controvert findings of the CIT(A), I find the impugned order well-reasoned, hence, warrants no interference.
In the result, impugned order is upheld and appeal of the Revenue is dismissed being devoid of any merit.
Order pronounced in the open court on Monday the 16th day of February, 2026.