SPJ Cargo Private Limited vs Deputy Commissioner Of Income Tax

PER MANISH AGARWAL, A.M.:

The present appeal is filed by assessee against the order dated 16.01.2026 passed by Ld. Commissioner of Income Tax (A), National Faceless Appeal Centre (“NFAC”), Delhi [“Ld. CIT(A)”] in Appeal No. NFAC/2020-21/10213602 u/s 250 of the Income Tax Act, 1961 [“the Act”] arising out of assessment order dated 27.12.2022 passed u/s 143(3) r.w.s. 144B of the Act pertaining to Assessment Year 2021-22.

Brief facts of the case are that the assessee is a Private limited Company, engaged in the business of international logistics and Cargo Services and the return of income was filed on 18.02.2022, declaring total income at INR 19,91,50,630/-. The case of the assessee was selected for scrutiny under CASS for various reasons and assessment was completed in terms of order passed u/s 143(3)/144B of the Act dated 27.12.2022 wherein the AO has observed that assessee had claimed the income from commission and brokerage of INR 64,32,564/- as pertaining to the subsequent assessment years though it has followed Mercantile System of Accounting therefore, the same should be taxed in the year under appeal and accordingly, made the addition of the same as business income. Besides this, the AO observed that there was difference in the business receipts of INR 1,48,49,064/- as per the billing done with respect to 02 parties and as per the receipts recorded in the books of accounts and accordingly, the said amount was held as undisclosed receipts and addition was made of the said amount. The AO further observed that assessee has paid interest of INR 49,596/- on delayed payment of GST which was penal in nature and thus the same was disallowed. The assessee claimed balances written off of INR 14,28,881.99 which was disallowed by the AO by invoking Proviso 2 to section 37 of the Act. Accordingly, total income was assessed at INR 22,19,10,736/-.

Against the said order, assessee preferred an appeal before the ld. CIT(A) who vide impugned order dated 16.01.2026, has partly allowed the appeal of the assessee wherein disallowance made out of the expenses claimed by the assessee were allowed and addition with respect to the contract receipts of INR 1,48,49,064/- was sustained.

Aggrieved by the order of ld. CIT(A), the assessee is in appeal before the Tribunal by taking various Grounds of appeal mentioned in the appeal memo.

Grounds of appeal Nos. 1 to 3 raised by the assessee are with respect to the confirmation of addition of INR 1,48,49,604/- therefore, they are taken together for consideration.

Before us, ld.AR for the assessee submits that assessee has raised total bills of INR 14,37,22,528/- to M/s Al-Ammar Frozen Foods Exports Pvt. Ltd. against which the said party has recorded total bills of INR 17,16,32,194/- and accordingly, there was a difference of INR 2,79,09,661.71. Ld. AR submits that M/s Al-Ammar Frozen Foods Exports Pvt. Ltd. has issued debit notes of INR 1,31,40,494/- and the difference to the extent of debit notes was accepted by the AO and the difference of remaining amount explained as due to GST, TDS and credit notes issued from time to time was not accepted by the lower authorities. The assessee has filed re-conciliation statement to explain this difference which is placed at pages 252 to 285 of the Paper Book (PB) and summary of the said is placed at page 251 of the Paper Book. As per ld.AR, if the said re-conciliation statement is considered no difference remains in the receipts declared by the assessee.

With respect to the difference of INR 79,896/- with M/s. Mersel Foods Pvt. Ltd., ld.AR drew our attention to the re-conciliation statement submitted wherein it was explained that the difference was due to timing difference of recording the bills by the concerned party and it is submitted that there was no such difference. It is thus submitted that the addition made and confirmed on this score by the lower authorities be deleted.

On the other hand, ld. DR for the Revenue vehemently supported the orders of the lower authorities and submits that there was difference in the bills as per the assessee’s books of accounts and as was recorded by the respective parties in their books of accounts and assessee has failed to give any plausible explanation for the same and therefore the addition made deserves to be uphold.

Heard the contentions of both the parties at length and perused the material available on record. It is observed that the AO has made the addition by observing that there was difference in the bills raised by the assessee and as recorded by the respective parties. The assessee explained that the same was due to issue of credit notes, TDS and GST amount and has filed re-conciliation statements along with respective credit notes, invoices and TDS certificate etc. All these facts remained unverified by the AO while making the additions.

Considering the entirety of facts, we remand this issue to the file of the AO with the directions to examine the re-conciliation statements filed by the assessee with respect to the bills raised to M/s Al-Ammar Frozen Foods Exports Pvt. Ltd. and M/s. Mersel Foods Pvt. Ltd. The assessee is also directed to file all the necessary details/evidence to reconciler the difference such as invoices, credit/debit notes, TDS certificates etc. and the AO is directed to decide the issue in accordance with law. Accordingly, Grounds of appeal Nos. 1 to 3 raised by the assessee are allowed for statistical purposes.

The remaining Grounds of appeal raised by the assessee become academic in nature hence, not adjudicated.

In the result, appeal of the assessee is allowed for statistical purposes.