Additions U/s 69C Based Merely On CBIC Information Can't Be Sustained: Delhi High Court

The Delhi High Court overturned the assessment order and referred the matter back to the Assessing Officer (AO) as the additions of Rs.70.10 Cr. under Section 69C, based solely on information from the Central Board of Indirect Taxes & Customs (CBIC), were deemed unsustainable. Justices Vibhu Bakhru and Tara Vitasta Ganju emphasized that the AO must acquaint themselves with the details of such expenditures and afford the taxpayer an opportunity to explain. \r

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Notably, the AO made the additions without disclosing the specific imports concealed by the taxpayer and relied solely on CBIC information, disregarding any reconciliation. The court criticized the Revenue for faulting the taxpayer without providing adequate information for reconciliation, noting that CBIC data lacked specificity and could not be unquestioningly accepted. \r

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Therefore, the High Court mandated the AO to reassess the case in adherence to the law, emphasizing the need for detailed information and taxpayer explanation before any addition is made. Counsel for the taxpayer included Salil Kapoor, Sumit Lalchandani, Ananya Kapoor, Tarun Chanana, and Utkarsa K. Gupta, while representation for the department was provided by I. Singh, Sanjeev Menon, Rahul Singh, Nishant Shokeen, and Sumita Singh.