Case Number: ITA 1339/DEL/2020
Appellant: DCIT Central Circle-19, New Delhi
Respondent: KRBL Limited, Delhi
Assessment Year: 2011-12
Case Filed On: 2020-06-30
Order Type: Final Tribunal Order
Date of Order: 2022-05-09
Pronounced On: 2022-05-09
Before Sh. A.D. Jain, Vice President and Dr. B. R. R. Kumar, Accountant Member
In the Income Tax Appellate Tribunal (ITAT) Delhi Bench ‘C’, New Delhi, a series of appeals were heard, involving the revenue’s case against KRBL Limited, Delhi. The primary focus was on the assessment year 2011-12, though multiple years were scrutinized for consistent issues related to paddy purchase transactions and the application of tax laws.
The appellant, DCIT Central Circle-19, New Delhi, raised several grounds against the deletion of significant additions made during the assessments. The key issues highlighted included the absence of incriminating material found during searches, the applicability of Section 40A(3), and the reliance on documentation provided by KRBL Limited to claim exemptions.
KRBL Limited, represented by Sr. Adv. Ajay Vohra, Adv. Aditya Vohra, and CA Arpit Goyal, contended that the purchases were genuine and conducted through appropriate channels. The respondent maintained that all transactions were documented, taxes paid, and purchases made directly from farmers through Mandi Samiti, hence eligible for exemptions under Rule 6DD(e).
During the hearings, extensive discussions were held on the following:
The Tribunal noted that while the Revenue claimed the presence of incriminating material, the actual seized documents did not conclusively prove non-genuine transactions for the assessment year in question.
The application of Section 40A(3) was scrutinized. The Tribunal examined whether the transactions exceeded the cash payment limits without valid exceptions. The respondent provided extensive documentation to support compliance, arguing for the legitimacy of purchases from farmers under Mandi Samiti regulations.
The Tribunal considered the implications of relying on judicial precedents like the Delhi High Court’s decision in CIT vs. Meeta Gutgutia, pending further adjudication in the Supreme Court.
Evidence provided by the Mandi Samiti, including Form 6R and gate pass verifications, played a crucial role in validating the respondent’s claims. The Tribunal assessed the credibility and regulatory compliance of these documents.
The Tribunal, after considering the extensive submissions and documentation, ruled in favor of KRBL Limited for the assessment year 2011-12. The deletion of the additions made by the CIT(A) was upheld, reinforcing the legitimacy of the respondent’s purchase transactions and the compliance with tax regulations.
This case underscores the complexities involved in tax assessments related to agricultural transactions and the importance of detailed documentation and adherence to regulatory frameworks.
Income Tax Appellate Tribunal Case ITA 1339/DEL/2020: DCIT Central Circle-19 vs KRBL Limited
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