आयकर अपीलीय अधिकरण, ‘ए’ न्यायपीठ, चेन्नई।

IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH: CHENNAI माननीय श्री मनु कु मार धिरर ,न्याधयक सदस्य एवं माननीय श्री अमिताभ शुक्ला , लेखा सदस्य के सिक्ष BEFORE HON’BLE SHRI MANU KUMAR GIRI, JUDICIAL MEMBER AND HON’BLE SHRI AMITABH SHUKLA, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.2955/Chny/2024, Assessment Years: 2014-15 Midas Golden Distilleries Private Deputy Commissioner of Income Limited, Tax, No.2/207, Sirumathur Village, Padappai- Central Circle-2(2).

Pushpagiri Road, Chennai.

Sriperumbudur, Tamil Nadu-601 301.

[PAN: AADCM9073D]

(अपीलार्थी/Appellant) (

प्रत्यर्थी

/Respondent)

अपीलार्थी की ओर से/ Assessee by : Shri Sanjay, CA प्रत्यर्थी की ओर से /Revenue by : Shri Shivanand K Kalakeri, CIT सुनवाई की तारीख/Date of Hearing : 24.03.2025 घोषणा की तारीख /Date of Pronouncement : 07.05.2025 आदेश / O R D E R PER AMITABH SHUKLA, A.M :

This appeal is filed by the assessee against the order bearing DIN & Order No.ITBA / APL / S / 250 / 2024-25 / 1069075013(1) dated 25.09.2024 of the Learned Commissioner of Income Tax [herein after “CIT(A), Chennai for the assessment years 2014-15.

2.0 Before proceeding further, it is deemed necessary to briefly analysis the factual matrix of the case. The Appellant M/s. Midas Golden Distilleries Pvt. Ltd. is a major manufacturer of alcoholic beverages and supplier to Tamil Nadu State Marketing Corporation (TASMAC) a company owned by the Government of Tamil Nadu, which has a monopoly over the wholesale and retail sale of alcoholic beverages in the state. A search u/s 132 of the Act was carried out at the business premises of the appellant Company on 09.11.2017. As a sequel to this search, the premises of the vendors of the appellant Company were also subjected to search u/s 132 of the Act. During the course of search u/s132 of the Act at the business premises of the suppliers of Bottles & Cartons to the assessee Company M/s. Sri Sai Enterprises (herein after referred as SSE) and M/s Sri Sai Cartons (herein after referred as SSC) at Adayar, a bunch of loose sheets were found and seized vide Ann/SP/SSE/LS/32 dated 27.12.2017. These loose sheets revealed the fact that the Bottles & Cartoons supplied to the assessee company were invoiced at overpriced rates by both the entities SSE & SSC. The Authorised Officer confronted the findings of the search with Shri. K. Karthikeyan, Director of the assessee company and recorded a statement u/s 132(4) of the Act on 29.12.2017. In the statement recorded Shri. K. Karthikeyan has admitted that the details mentioned in the seized loose sheets related to rates of over invoicing of purchase of bottles /cartons from SSE (a firm ln which Shri S.Chandrasekaran is the managing partner)

and SSC which is owned by Shri Jaganathan S/o S. Chandrasekaran. It was also clarified that as agreed between him and Shri S. Chandrasekaran over invoicing of sale of bottles/ cartons was resorted to by SSE and SSC on their sales to the assessee Company at certain prescribed rates. Accordingly, it was contended that exact quantity of over invoicing depended on the type of bottles / cartons which varied from 10 paise to 30 paise and 75 paise to 175 paise respectively as mentioned in the loose sheets.

2.1 Further, Shri K.Karthikeyan had also deposed during the search proceedings that SSE had been generating cash through bogus purchases from some of its suppliers and at a prescribed rate. The cash generated through such bogus purchases were siphoned off from the system and in turn handed over to the assessee Company in lieu of over invoicing of sales done to the assessee apparently collected by him / his employees/ business concerns so as to meet certain incidental expenses which are peculiar to this line of business. Shri K.Karthikeyan also furnished the quantitative details of bottles and cartoons purchased from SSE and SSC during the FY(s) from 2007-08 to 2017-18 (till the date of search) based on the daily production report, cross checked with excise records. He h