IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “G” BENCH: NEW DELHI BEFORE SHRI YOGESH KUMAR U.S, JUDICIAL MEMBER &

SHRI MANISH AGARWAL, ACCOUNTANT MEMBER [Assessment Year : 2012-13]

Shiv Hari Singla, vs ITO, H.No.665, Sec-17, Ward-1(1), Faridabad, Haryana-121002. Faridabad PAN-ACBPS4477N APPELLANT RESPONDENT Appellant by Shri Tarandeep Singh, Adv. &

Shri Sandeep Yadav, Adv.

Respondent by Shri Manish Gupta, Sr.DR Date of Hearing 29.05.2025 Date of Pronouncement 27.08.2025 ORDER PER MANISH AGARWAL, AM :

The present appeal is filed by the assessee against the order dated 12.02.2020 passed by Ld. Commissioner of Income Tax (A), Faridabad [“Ld.CIT(A)”] in Appeal No.10216/2015-16 u/s 250 of the Income Tax Act, 1961 [“the Act”] arising out of assessment order dated 27.03.2015 passed u/s 143(3) of the Act pertaining to Assessment Year 2012-13.

2. Brief facts of the case are that assessee is an individual and filed his return of income on 31.03.2013, declaring total income of INR 13,37,910/-. The case of the assessee was selected for scrutiny and notice u/s 143(2) of the Act was issued on 23.09.2013. The assessee was engaged in the business of contractor in MES where the assessee was providing installation, erection and maintenance of Air Conditioning System to MES and also to private parties besides trading in items relating to air conditioning systems. The total sales for the year before us was declared at INR 6,44,87,306/-. The AO accepted trading result declared however, on verification of the books of accounts, it was observed that assessee shown sundry creditors of INR 9,06,59,009/- as on 31.03.2012 which were very high thus, the AO proceeded to examine these creditors. After verification, AO short-listed four parties to whom notices were issued u/s 131 of the Act which were returned unserved. During personal visit by the Inspector, it was found that either the shop found closed or no shop was available at the given address. Thereafter, the AO discussed the outcome of enquiries made in respect of each of the party in para 2.6 of its order and held these four parties as bogus and unexplained creditors and total outstanding in their names at INR 3,36,88,080/- was added as income from undisclosed source in the hands of the assessee. Besides this, other petty additions were also made. Accordingly, total income of the assessee was assessed at INR 3,62,25,707/-.

3. Against this order, assessee preferred an appeal before Ld. CIT(A) who vide impugned order dated 12.02.2020 partly allowed the appeal wherein purchases from four entities was held as bogus and relief was allowed in respect of other additions made by the AO. 4. Aggrieved by the said order of Ld.CIT(A), assessee is in appeal before the Tribunal by taking following grounds of appeal:-

1. “That, on the facts & circumstances of the case and in law, the CIT(A) was not justified in confirming the disallowance of entire purchases of Rs.3,36,88,080/-made from 4 parties mentioned in the order. The findings of CIT(A) are perverse & rather based on surmises & conjectures and in ignorance of the relevant facts on record and also contrary to the legal position declared by courts.

2. Without prejudice to above, the entire sales being found to be genuine, the AO as well as CIT(A) ought to have allowed the cost of purchases relatable to such sales as declared by various hon'ble Courts as well as by the hon'ble Tribunal.

3. That, on facts of the case, the CIT(A) was not justified in partly restoring the issue of disallowance of interest for fresh determination.

4. The appellant craves to add or modify the grounds of appeal, if required.”

5. Ground of appeal No.3 is not pressed hence, dismissed.

6. The remaining Ground of appeal Nos. 1 & 2 are with respect to the addition of INR 3,36,88,080/- confirmed by Ld.CIT(A) towards the balance outstanding in the name of four creditors held as paper entities.

7. Before us, Ld.AR submits that during the course of assessment proceedings, assessee produced books of account