9911796707
TMI Blog2025 (3) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment for the A.Y. 2011-12 in the case of the assessee was completed under Section 143(3) of the Income Tax Act, 1961 (in short 'the Act') on 28.03.2013 at total income of Rs.175,41,75,717/-. Thereafter, the AO had received an information regarding booking of bogus expenses by KNRCL and Aravali Infra Power Ltd. through Safeco Project Pvt. Ltd. and Totem Infrastructure Ltd and as per information work was awarded by the assessee company to them on back to back basis. Therefore, the case of the assessee was reopened u/s.147 of the Act after recording proper reason. The re-assessment was completed u/s.143(3) r.w.s. 147 of the Act on 07.03.2016 on total income of Rs.1,68,35,29,520/-. In the course of re-assessment, the AO had found that the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der u/s 145A r.w.s. 143(3)r.w.s. 147 of the Act ignoring the legal position that an assessment order u/s 143(3) r.w.s. 153B(1)(b) was already passed and therefore the reopening of an assessment made u/s 153b is illegal. 2.1 The Learned Commissioner of Income Tax (Appeals) grossly erred in rejecting the Appellant's ground that the AO has not obtained the prior approval Add. CIT before passing the impugned order which is mandatorily required as per the provisions of the income tax act before passing an order u/s 153A/B/C 2.2 The Learned Commissioner of Income Tax (Appeals) grossly erred in law and on facts ignoring that the AO reopened the case u/s 147 by issue of notice u/s 148 solely by relying on some alleged information received f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Given Below is the clear summary of the Addition Sustained: Party Name Payment made by the said party (A) GP Rate As prescribed by the CIT(A) (B) Quantum Sustained By CIT(A) (C=A*B) GP Rate already reflected by the assessee in books of account i.e. 11.15 & 15.49 (D) Addition confirmed by CIT(A) i.e. Difference (E=C-D) Arvali 22,65,10,000 16% 3,62,41,600 2,84,33,200 78,08,400 KNR 10,20,56,400 16% 1,63,29,024 1,58,08,536 5,20,488 Total 83,28,888 4.3 The Learned Commissioner of Income Tax (Appeals) grossly erred in law and on facts of the case by estimating the GP of the Appellant at 16% on such transactions without citing any base or GP in comparative cases. 4.4 The Learn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not pressed. Therefore, all the grounds, except Ground No.4.3, are dismissed. 6. On merits, the Ld. Counsel submitted that the estimation of income @16% as confirmed by the Ld. CIT(A) was still very high. He explained that the AO had estimated the profit @ 25% by considering the gross profit of the assessee, which was 15.49%. The Ld. CIT(A) had sustained the addition @16%, which was slightly higher than the gross profit rate of 15.49%. The Ld. AR explained that the net profit of the assessee was much less at 6 to 7% and, therefore, the addition @16% was much higher. The Ld. Counsel submitted that identical issue was involved in assessee's own case in A.Y. 2009-10 and also in the years 201213 to 2018-19, which was adjudicated by the Co-ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsactions, which was more or less comparable with the gross profit of the assessee. We find that identical issue was involved in the assessee's own case in A.Y. 2009-10, which was decided by the Co-ordinate Bench of this Tribunal in IT(SS)A No.363/Ahd/2018. In that year, on the basis of information received from Maharashtra Sales Tax Department that the assessee had claimed bogus purchase of materials, the AO had disallowed the entire purchases, which was reduced to 25% by the Ld. CIT(A). On further appeal, the Co-ordinate Bench of this Tribunal has restricted the disallowance to 12.5% of the bogus purchases. The same basis was followed to restrict the disallowance in respect of bogus sub-contract expenses in A.Ys. 2012-13 to 2018-19 in IT( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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