INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “E”: NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER (Assessment Year: 2014-15)

Manoj Chadha, Vs. ACIT, W-16/19, Western Avenue, Circle-31(1), Sainik Farms, New Delhi New Delhi (Appellant) (Respondent)

PAN:

Assessee by : Shri Manoj Kumar, CA Revenue by: Sh. Dheeraj Kumar Jain, Sr. DR Date of Hearing 23/07/2025 Date of pronouncement 25/07/2025 O R D E R PER M. BALAGANESH, A. M.:

1. The appeal in ITA No.3563/Del/2023 for AY 2014-15, arises out of the order of the National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘ld. NFAC’, in short] in Appeal No. ITBA/NFAC/S/250/2023-24/1057143960(1) dated 17.10.2023 against the order of assessment passed u/s 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 29.12.2016 by the Assessing Officer, ACIT, Circle-31(1), New Delhi (hereinafter referred to as ‘ld.

AO’).

2. The ground Nos. 1 and 5 raised by the assessee are general in nature and does not require any specific adjudication.

3. Ground No. 2 raised by the assessee is challenging the addition of Rs. 1,80,55,733/- u/s 68 of the Act.

4. We have heard the rival submissions and perused the material available on record. The return of income for AY 2014-15 was filed by the assessee on 21.11.2014 declaring total income of Rs. 21,82,210/-. The assessee had declared business income and income from other sources. During the year under consideration, the assessee has shown Rs. 3,12,66,909/- as sundry creditors in its balance sheet. The ld AO asked assessee to submit the details of creditors along with address and confirmations. The assessee submitted the list of creditors along with their addresses. No confirmations were filed by the assessee. Subsequently, notices u/s 133(6) of the Act were issued to 9 creditors parties. In respect of 2 parties, notices were returned undelivered. In respect of 2 parties, no reply was received from the parties. Accordingly, the assessee vide order sheet entry dated 02.12.2016 was directed to submit confirmations from the 5 parties. The assessee could not produce the confirmations from these creditors during the assessment proceedings. The ld AO tabulated the list of those 5 parties and observed that the amounts credited in their accounts during the year in the sum of Rs. 1,80,55,733/- to be added as unexplained cash credit u/s 68 of the Act.

5. Before the ld CIT(A), the assessee furnished PAN together with the name and address of these 5 creditors. The assessee also submitted that these are trade creditors and from whom purchases have been made by the assessee and merely because the suppliers does not respond to the notice u/s 133(6) of the Act before of the ld AO, the purchase made by the assessee cannot be doubted. The assessee also furnished the details of payments made in respect of these disputed sundry creditors and provided the confirmations from them together with the reconciliation of the balance outstanding. The ld CIT(A) called for a remand report from the ld AO. In the remand report, the ld AO accepted the contentions of the assessee in respect of 4 parties except Kamdhenu Foods Ltd. Despite that, the ld CIT(A) concluded that these evidences were not submitted by the assessee during the assessment proceedings and upheld the additions made by the ld AO in the total sum of Rs.

1,80,55,733/- u/s 68 of the Act.

6. At the outset, the addition made in the sum of Rs. 1,80,55,733/- represent purchases made by the assessee from 5 parties. In respect of purchases, only debit entry was made by the assessee and hence the provisions of section 68 of the Act per se cannot be made applicable for the same. However, the sales made by the assessee out of disputed purchases have been accepted. It is not the case of the revenue that purchases were made outside the books. Accordingly, the addition made on account of purchases made u/s 68 is hereby deleted.

7. Ground No. 3 raised by the asses