IN THE INCOME-TAX APPELLATE TRIBUNAL“E” BENCH, MUMBAI BEFORE SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER &

SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER ITA No. 5623/MUM/2024 (A.Y. 2011-12)

Income Tax Officer, Ward – v/s. M/s Kobe Steel India

19(2)(2), 450, Lotwala Bldg.

बनाम

450, Lotwala Bldg.

Pathebapurao Marg, Near Pathebapurao Marg, Near Singhi Gali, Mumbai – Singhi Gali, Mumbai – 400

400004, Maharashtra 004, Maharashtra स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AAAFK2456L Appellant/अपीलार्थी .. Respondent/प्रतिवादी

For Assessee : Shri Vimal Punmiya, AR For Revenue : Shri Hemanshu Joshi (Sr. DR)

Date of Hearing 24.07.2025 Date of Pronouncement 10.09.2025 आदेश / O R D E R PER PRABHASH SHANKAR [A.M.] :-

The present appeal is filed by the Revenue against the order passed by the Learned Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre, Delhi [hereinafter referred to as “CIT(A)”] pertaining to assessment order passed u/s. 143(3) of the Income-tax Act, 1961 [hereinafter referred to as “Act”] dated 25.03.2014 for the Assessment Year [A.Y.] 2011-12.

2. The grounds of appeal are as under:

1. “Whether on the facts and in the circumstances of the case and in law, Ld. CIT(A) has erred in deleting the entire addition of Rs. 98,15,270/ made as unexplained expenditure u/s 69C of the Income-Tax Act 1961, without considering the fact that the action of the Assessing Officer was based on credible information received from the Maharashtra Sales Tax Department, that the parties declared as hawala traders who were bogus traders and not doing any genuine business, but were involved in providing only accommodation entries of bogus purchases ?”

2. “Whether on the facts and in the circumstances of the case and in law, Ld. CIT(A) has erred in deleting the entire addition of Rs. 98,15,270/ made as unexplained expenditure u/s 69C of the Income-Tax Act 1961, by ignoring the fact that assessee had claimed purchases from M/s. Shree Sundha Steels Private Limited, a party which has allegedly been enlisted as Hawala Trader, through the Investigations carried out by the Maharashtra Sales Tax Department and it was found that assessee was one, who has obtained accommodation entries through bogus bills for the suspicious purchases ?”

3. “Whether on the facts and in the circumstances of the case and in law, Ld. CIT(A) has erred in deleting the entire addition of Rs. 98,15,270/- made as unexplained expenditure u/s 69C of the Income-Tax Act 1961, by ignoring the fact that during the assessment proceedings the assessee has failed to provide documentary evidences such as transport bills and delivery challan etc. which proves that there was no genuine transactions carried out and the assessee was only obtained accommodation entries, without delivery of actual materials or goods ?”

4. “Whether on the facts and in the circumstances of the case and in law, Ld. CIT(A) has erred in deleting the entire addition of Rs. 98,15,270/- made us unexplained expenditure u/s 69C of the Income-Tax Act 1961, without appreciating the views expressed in Section 69C of the IT Act, that where an assessee has incurred any expenditure and he offers no explanation about the source of such expenditure or part thereof or if the explanation officer by him is in the opinion of the AO not satisfactory, the amount covered by such expenditure or part thereof, as the case may be deemed to be the income of the assessee for the financial year under consideration?”

5. “Whether on the facts and in the circumstances of the case and in law, Ld. CIT(A) has erred in deleting the entire addition of Rs. 98,15,270/- made as unexplained expenditure u/s 69C of the Income-Tax Act 1961, without appreciating the decision of the Hon'ble Apex Court, in the case of M/s. N. K. PROTEINS LTD Vs. Dy. CIT (2016) 292 CTR (Gul.) 354, Dated. 16.01.2017, wherein the Hon'ble Court has held that, when the purchases are from bogus suppliers/hawala traders, the entire suspicious purchases are liable to be disallowed ?”

6. “Whether