IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘C’, NEW DELHI Before Sh. Satbeer Singh Godara, Judicial Member &

Sh. Manish Agarwal, Accountant Member ITA No. 2990/Del/2023 : Asstt. Year : 2016-17 ITA No. 2991/Del/2023 : Asstt. Year : 2017-18 DCIT, Vs M/s Ikea India Pvt. Ltd., Central 10(1), Unit No. 421, DLF Tower, New Delhi-110002 Jasola District Centre, New Delhi-110044 (APPELLANT) (RESPONDENT)

PAN No. AADCI3006N Assessee by : Ms. Shurti Khimta, AR Revenue by : Sh. Dayainder Singh Sidhu, CIT-DR Date of Hearing: 30.09.2025 Date of Pronouncement: 30.09.2025

ORDER

Per Satbeer Singh Godara, Judicial Member:

These Revenue’s twin appeals in ITA Nos. 2990 &

2991/Del/2023 for Assessment Years 2016-17 & 2017-18, arise against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2023-24/1055437476(1) & 1055440298(1) dated 25.08.2023, in proceedings u/s 143(3) of the Income Tax Act, 1961 (in short “the Act”), respectively.

2. Heard both the parties at length. Case files perused.

3. The Revenue’s “lead” appeal herein ITA No.

2990/Del/2023 raises the following substantive grounds:

“1. Whether on the facts and circumstances of the case and in law, the ld. CIT(A) erred in deleting the disallowance of business expenditure amounting to Rs.86,72,91,323/- in profit and loss account on the ground that there is no business set up during the year?

2. Whether on the facts and circumstances of the case and in law, the ld. CIT(A) erred in ignoring the fact that no evidence has been adduced to show that the assessee did not file any evidence substantiating that it has undertaken negotiation with suppliers?”

4. We next note that the sole substantive issue between the parties is as to whether the assessee had set up it’s business in the impugned lead assessment year 2016-17 or not; is found to be hardly res integra in light of the learned co-ordinae bench’s order in Revenue’s twin appeals ITA No. 7506/Del/2017 and 4834/Del/2019 for assessment years 2014-15 and 2015-16, decided on 17.10.2023 rejecting the very stand as under:

“4. Briefly, the facts are, assessee is a resident corporate entity stated to be engaged in the business of undertaking single brand retail trading of various products under the ‘IKEA’ brand. For the assessment year under dispute, assessee filed its return of income under Section 139(1) of the Act.

5. In course of assessment proceedings, while verifying the audited financial statements of the assessee, the Assessing Officer noted that assessee has debited expenses to the tune of Rs.18,94,65,541 in assessment year 2014-15 and Rs.50,13,18,999 in assessment year 2015-16. Whereas, assessee has not shown any receipts from business in the aforesaid two assessment years. Being of the view that in absence of any business operation during the year, no expenses can be allowed. The Assessing Officer issued a show cause notice to the assessee proposing disallowance of the expenses. In response to the show cause notice, assessee filed a detailed submission objecting to the proposed disallowance. However, rejecting the contentions of the assessee, Assessing Officer proceeded to disallow the expenses in both the assessment years under dispute.

6. Contesting the disallowances, assessee preferred appeals before learned Commissioner (Appeals).

7. After considering the submissions of the assessee in the context of facts and material on record, learned Commissioner (Appeals) held that the assessee has set up its business activities. He observed, merely because the assessee has not undertaken any sales/purchase, it cannot be said that business has not been set up. Relying upon various judicial precedents including the decision of Hon'ble jurisdictional High Court in the case of Carefour WC& C India (P) Ltd. vs. DCIT (2015) 53 Taxmann.com 289, learned Commissioner (Appeals) deleted the disallowances.

8. Before us, learned Departmental Representative submitted, though, business has been set up, however, it has not commenced its business as actual purchase and sal