Sh. Amit Arora vs NFAC

PER SATBEER SINGH GODARA, JM

This assessee’s appeal for assessment year 2021-22, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s DIN and order no. ITBA/NFAC/S/250/2024-25/1071813493(1), dated 02.01.2025 involving proceedings under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’).

Case called twice. None appears at the assessee’s behest. He is accordingly proceeded ex-parte.

2 For the reasons stated in the assessee’s condonation averments, delay of 221 days in filing of the instant appeal is condoned in light of Collector, Land & Acquisition vs. Mst. Katiji & Others (1987) 167 ITR 471 (SC).

It next transpires during the course of hearing that the assessee/appellant is aggrieved against both the learned lower authorities’ respective assessment and lower appellate findings inter alia disallowing his alleged bogus purchases of Rs. 5,13,50,110/- @ 25% followed by similar disallowance of Rs.24,34,846/- involving M/s. Moksha Enterprises in entirety in the Assessing Officer’s order dated 24.12.2022 which has been partly upheld to the extent of GP estimation @ 1.14% regarding the former sum only.

This what leaves the assessee aggrieved.

We have given our thoughtful consideration to the assessee’s and the Revenue’s rival stands all along. We are of the considered view that so far as the alleged bogus purchase amounting to Rs.5,13,51,100/- @ 25% in assessment and restricted to GP @ 1.14% in the CIT(A)/NFAC lower appeal is concerned, no fault could be found therein since based on the peculiar facts of the case.

We thus express our complete agreement with the learned CIT(A)/NFAC’s impugned findings based on a catena of case laws that only GP estimation could be taken recourse to in such instance.

Next comes the latter issue of bogus purchase in entirety amounting to Rs.24,34,846/- involving the assessee’s twin suppliers (supra). We notice herein as well that given the fact that neither the assessee’s regular business activity nor his corresponding sales are in dispute. There is hardly any scope of deviation as he has all along proved both his sales and regular business activity as well. We thus deem it appropriate to conclude that a lumpsum GP estimation @ 1.14% in this latter issue as well would meet the ends of justice with a rider that the same shall not be treated as a precedent. Necessary computation shall follow as per law.

This assessee’s appeal is partly allowed.