DEEPAK BHANWARLAL JAIN,MUMBAI V. ASSISTANT COMISSIONER OF INCOME TAX -CC-5(1), MUMBAI

ITA 4024/MUM/2023

AI Insights

The case involves multiple appeals by the assessee, Deepak Bhanwarlal Jain, against the common order of the CIT(A) for the assessment years 2014-15 to 2019-2020. The appeals were consolidated due to the similarity of the grounds raised. The primary issues revolved around the invocation of Section 153A of the Income Tax Act without incriminating evidence and the addition of commission income under Section 69A. The Tribunal noted that during the search, the assessee admitted to providing accommodation entries and computed commission income based on these entries. The CIT(A) and the Tribunal both found that there was sufficient incriminating material to uphold the additions.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 471382 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 15-10-2024
• Assessment Year: 2019-2020
• Appeal Filed On: 09-11-2023
• Other Referred Cases: Warehousing Corporation 374 ITR 645, Skyway Infra Projects Pvt. Ltd. 2665/Mum/2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SANYOGITA NAGPAL
• Keywords: Search and seizure; Accommodation entries
• Section: 153A; 69A

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “D” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND MS. KAVITHA RAJAGOPAL (JUDICIAL MEMBER) ITA Nos. 4025, 4027, 4026, 4030, 4029 & 4024/MUM/2023 Assessment Years: 2014-15 to 2019-2020 Deepak Bhanwarlal Jain, 104, Sai Shakti Tower, Jesal Park, Bhayander East, Thane-401105. Vs. ACIT-CC-5(1), 1928, 19th floor, Air India Building, Nariman Point, Mumbai-400021. PAN NO. ACWPJ 8573 D Appellant Respondent Assessee by : None Revenue by : Mrs. Sanyogita Nagpal, CIT-DR Date of Hearing : 15/10/2024 Date of pronouncement : 22/10/2024 ORDER PER BENCH These appeals have been preferred by the assessee against a common order dated 12.09.2023 passed by the Ld. Commissioner of Income-tax (Appeals) – 53, Mumbai [in short ‘the Ld. CIT(A)’] for assessment years 2014-15 to 2019-2020 respectively. As common grounds have been raised in all these appeal and therefore, same were heard together and disposed off by way of this consolidated order for convenience. 2. Since identical grounds have been raised in all the years and therefore, for brevity, we reproduce assessee for assessment year 2014 1. On the facts and circumstances of the Appellant's case and in law the Ld. Commissioner of Income Tax (Appeals) has erred in confirming the action of the Ld. AO in invoking the section 153A without any incriminating evidence found during the course of search action. 2. On the facts and circumstances of the Appellant's case and in law the Ld. Commissioner of Income Tax (Appeals) erred in confirming the addition of Rs.4,0 Commission Income by invoking the provisions of Section 69A of the Income Tax Act, 1961. 3. Briefly stated, facts of the case are that a search and seizure action was carried out on 06.11.2019 at the premises of the assessee and consequently notice u/s 153A of the Income 1961 (in short ‘the Act’) were issued for the captioned assessment years. The Assessing Officer noted that during the course of the search proceedings, the assessee engaged in providing concerns controlled by computed the commission @ 015% those concerns and added to the income of the assessee Asst. Year 2014-15 2015-16 2016-17 2017-18 ITA Nos. 4025, 4027, 4026, 4030, 4029 & were heard together and disposed off by way of this consolidated order for convenience. Since identical grounds have been raised in all the years and efore, for brevity, we reproduce the grounds raised by the assessee for assessment year 2014-15 only as under: On the facts and circumstances of the Appellant's case and in law the Ld. Commissioner of Income Tax (Appeals) has erred in confirming the action of the Ld. AO in invoking the provision of section 153A without any incriminating evidence found during the course of search action. On the facts and circumstances of the Appellant's case and in law the Ld. Commissioner of Income Tax (Appeals) erred in confirming the addition of Rs.4,03,048/- being alleged Commission Income by invoking the provisions of Section 69A of the Income Tax Act, 1961. Briefly stated, facts of the case are that a search and seizure action was carried out on 06.11.2019 at the premises of the quently notice u/s 153A of the Income 1961 (in short ‘the Act’) were issued for the captioned assessment years. The Assessing Officer noted that during the course of the search proceedings, the assessee acknowledged the fact of being oviding of accommodation entries through various controlled by him and therefore, the Assessing Officer computed the commission @ 015% on the transactions through those concerns and added to the income of the assessee Asst. Year Commission @ 0.15% 15 4,03,048 16 5,17,955 17 5,28,430 18 3,43 ,866 Deepak Bhanwarlal Jain 2 ITA Nos. 4025, 4027, 4026, 4030, 4029 & 4024/MUM/2023 were heard together and disposed off by way of this consolidated Since identical grounds have been raised in all the years and grounds raised by the as under: On the facts and circumstances of the Appellant's case and in law the Ld. Commissioner of Income Tax (Appeals) has erred in provision of section 153A without any incriminating evidence found during On the facts and circumstances of the Appellant's case and in law the Ld. Commissioner of Income Tax (Appeals) erred in being alleged Commission Income by invoking the provisions of Section 69A Briefly stated, facts of the case are that a search and seizure action was carried out on 06.11.2019 at the premises of the quently notice u/s 153A of the Income-tax Act, 1961 (in short ‘the Act’) were issued for the captioned assessment years. The Assessing Officer noted that during the course of the the fact of being accommodation entries through various him and therefore, the Assessing Officer on the transactions through those concerns and added to the income of the assessee as under: 2018-19 2019-20 2020-21 4. On further appeal, the assessee challenged the legality of the addition on the ground that no incriminating material qua the additions and therefore, following the decision of the Hon’ble Bombay High Court in the case of Warehousing Corporation 374 ITR 645 the Ld. CIT(A) referred to the decision of the Co the Tribunal in the case of 2665/Mum/2022 and held that in the course of survey proceedings on the premises by the companies controlled by the assessee evidences of business activity was found and inquiries c in the vicinity of those companies also could not establish the fact of the business activity by those companies. The Ld. CIT(A) treated those information as constituting CIT(A) also upheld addition on the merit. 5. Aggrieved the assessee is in appeal raising the grounds as reproduced above. 6. Despite notifying none attended on behalf of the assessee nor was any request for adjournment find that on 17.04.2024 a written applica the assessee seeking adjournment which was duly granted but thereafter none attended on behalf of the assessee on 20.06.2024, ITA Nos. 4025, 4027, 4026, 4030, 4029 & 19 54,004 20 1,26,667 21 4,626 On further appeal, the assessee challenged the legality of the addition on the ground that no incriminating material qua the additions and therefore, following the decision of the Hon’ble Bombay High Court in the case of Warehousing Corporation 374 ITR 645, no addition could have been made. But the Ld. CIT(A) referred to the decision of the Co-ordinate Bench of the Tribunal in the case of Skyway Infra Projects Pvt. 2665/Mum/2022 and held that in the course of survey proceedings on the premises by the companies controlled by the assessee business activity was found and inquiries c in the vicinity of those companies also could not establish the fact the business activity by those companies. The Ld. CIT(A) treated as constituting incriminating material. The Ld. CIT(A) also upheld addition on the merit. Aggrieved the assessee is in appeal raising the grounds as Despite notifying none attended on behalf of the assessee nor was any request for adjournment filed. On perusal of the record find that on 17.04.2024 a written application was filed on behalf of the assessee seeking adjournment which was duly granted but thereafter none attended on behalf of the assessee on 20.06.2024, Deepak Bhanwarlal Jain 3 ITA Nos. 4025, 4027, 4026, 4030, 4029 & 4024/MUM/2023 On further appeal, the assessee challenged the legality of the addition on the ground that no incriminating material was found qua the additions and therefore, following the decision of the Hon’ble Bombay High Court in the case of Warehousing no addition could have been made. But ordinate Bench of Skyway Infra Projects Pvt. Ltd. in ITA No. 2665/Mum/2022 and held that in the course of survey proceedings on the premises by the companies controlled by the assessee, no business activity was found and inquiries carried out in the vicinity of those companies also could not establish the fact the business activity by those companies. The Ld. CIT(A) treated incriminating material. The Ld. Aggrieved the assessee is in appeal raising the grounds as Despite notifying none attended on behalf of the assessee nor filed. On perusal of the record, we tion was filed on behalf of the assessee seeking adjournment which was duly granted but thereafter none attended on behalf of the assessee on 20.06.2024, 26.08.2024 and 15.10.2024. In view of the facts and circumstances of the case, we were interested in prosecuting the appeal and therefore, same ex-parte qua the assessee after hearing arguments of the Ld. Departmental Representative (DR). 7. We find that in the case assessee has challenged the legality of the addition on the ground that no incriminating material was found qua the addition of commission income made by the Assessing Officer. We find that the Ld. CIT(A) has referred to the decision of the Co-ordinate Bench of the Tribunal in the case of M/s Skyway Infra Projects P. Ltd. (supra) and held that it was not a case of merely statement by the assessee but in the survey proceedings carried out along with search certain incriminating facts observed in respect of companies controlled by the assessee through whom accommodation entries were provided. In our opinion, the finding of the Ld. CIT(A) on the issue in dispute is reasoned and no interference is called for in the same. The ground No. 1 raised in the appeals challenging invoking of section 153A in absence of any incriminating evidence is accordingly dismissed. 8. As far as ground No. 2 raised in the appeals on the merit is concerned in our opinion, the Ld. CIT(A) has correctly uphe commission income on the accommodation entries carried out by ITA Nos. 4025, 4027, 4026, 4030, 4029 & 26.08.2024 and 15.10.2024. In view of the facts and circumstances of the opinion assessee that assessee was interested in prosecuting the appeal and therefore, same parte qua the assessee after hearing arguments of the Ld. Departmental Representative (DR). We find that in the case assessee has challenged the legality of the addition on the ground that no incriminating material was found qua the addition of commission income made by the Assessing Officer. We find that the Ld. CIT(A) has referred to the ordinate Bench of the Tribunal in the case of M/s Skyway Infra Projects P. Ltd. (supra) and held that it was not a case of merely statement by the assessee but in the survey proceedings carried out along with search certain incriminating facts observed in respect of companies controlled by the assessee accommodation entries were provided. In our opinion, the finding of the Ld. CIT(A) on the issue in dispute is reasoned and no interference is called for in the same. The ground No. 1 raised in the appeals challenging invoking of section 153A in absence of any incriminating evidence is accordingly dismissed. As far as ground No. 2 raised in the appeals on the merit is concerned in our opinion, the Ld. CIT(A) has correctly uphe commission income on the accommodation entries carried out by Deepak Bhanwarlal Jain 4 ITA Nos. 4025, 4027, 4026, 4030, 4029 & 4024/MUM/2023 26.08.2024 and 15.10.2024. In view of the facts and circumstances that assessee was not interested in prosecuting the appeal and therefore, same were heard parte qua the assessee after hearing arguments of the Ld. We find that in the case assessee has challenged the legality of the addition on the ground that no incriminating material was found qua the addition of commission income made by the Assessing Officer. We find that the Ld. CIT(A) has referred to the ordinate Bench of the Tribunal in the case of M/s Skyway Infra Projects P. Ltd. (supra) and held that it was not a case of merely statement by the assessee but in the survey proceedings carried out along with search certain incriminating facts were observed in respect of companies controlled by the assessee accommodation entries were provided. In our opinion, the finding of the Ld. CIT(A) on the issue in dispute is reasoned and no interference is called for in the same. The ground No. 1 raised in the appeals challenging invoking of section 153A in absence of any incriminating evidence is accordingly dismissed. As far as ground No. 2 raised in the appeals on the merit is concerned in our opinion, the Ld. CIT(A) has correctly upheld the commission income on the accommodation entries carried out by the assessee through companies controlled by him. Accordingly, the ground No. 2 of the appeal of the assessee is also rejected. 9. In the result, all the appeals of the assessee are dism Order pronounced in the open Court on Sd/ (KAVITHA RAJAGOPAL JUDICIAL MEMBER Mumbai; Dated: 22/10/2024 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// ITA Nos. 4025, 4027, 4026, 4030, 4029 & the assessee through companies controlled by him. Accordingly, the ground No. 2 of the appeal of the assessee is also rejected. In the result, all the appeals of the assessee are dism nounced in the open Court on 22/10/2024. Sd/- (KAVITHA RAJAGOPAL) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai Deepak Bhanwarlal Jain 5 ITA Nos. 4025, 4027, 4026, 4030, 4029 & 4024/MUM/2023 the assessee through companies controlled by him. Accordingly, the ground No. 2 of the appeal of the assessee is also rejected. In the result, all the appeals of the assessee are dismissed. /10/2024. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Assistant Registrar) ITAT, Mumbai "