DEPUTY COMMISSIONER OF INCOME TAX, GWALIOR V. DAIRYMAN PRODUCER COMPANY LIMITED, GWALIOR

ITA 557/AGR/2024

AI Insights

The case involves an appeal by the revenue against the decision of the CIT(A) which had deleted the addition of commission income made by the Assessing Officer (AO). The AO had reopened the assessment for AY 2013-14 based on allegations that the assessee had made purchases from a sham entity involved in bogus sales. The assessee provided substantial evidence including ledger extracts, purchase bills, and bank statements to substantiate the legitimacy of the transactions. The CIT(A) agreed with the assessee's explanations, leading to the deletion of the addition, which was contested by the revenue in the Tribunal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 126608 (ITAT-AGRA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-04-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2013-2014
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUKESH KUMAR JAIN LD.
• Assessee Lawyers: SANJAY KUMAR; LD
• Keywords: Accommodation entries; Bogus; Dismissed; Commissioner; Commissioner of Income Tax; Purchases; Transfer; Transactions; Deleted
• Section: 147

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “DB” BENCH, AGRA BEFORE HON’BLE SHRI SATBEER SINGH GODARA, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपील सं. / ITA No. 557/Agr/2024 (िनधाŊरणवषŊ / Assessment Year:2013-14) DCIT- 1(1), Gwalior. बनाम/ Vs. Dairyman Producer Company Limited 3rd Floor, F-28, Sanjay Complex Jayendra Ganj, Gwalior. ̾थायीलेखासं./जीआइआरसं./PAN/GIR No. AACCD-7106-M (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/ Appellant by : Sh. Sukesh Kumar Jain – Ld. CIT-DR ŮȑथŎकीओरसे/Respondent by : Sh. Sanjay Kumar, CA – Ld. AR सुनवाईकीतारीख/Date of Hearing : 21-02-2025 घोषणाकीतारीख /Date of Pronouncement : 23-04-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by revenue for Assessment Year (AY) 2013-14 arises out of an order passed by learned Commissioner of Income Tax (Appeals), NFAC, Delhi [CIT(A)] on 21-10-2024 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 147 r.w.s. 144B of the Act on 30-03-2022. The sole grievance of the revenue is deletion of addition of commission income of Rs.822.67 Lacs as made by Ld. AO in the assessment order. Having heard rival submissions, the appeal is disposed-off as under. 2. The case for this year was reopened on the ground that the assessee made purchases of Rs.15.35 Crores from M/s Nandan Dairy Products which was termed as sham entity by the investigation wing. It was alleged that this entity indulged in carrying out bogus sales. The 2 assessee, in support of purchases, furnished ledger extracts, purchase bills and its bank statement. The assessee claimed to have purchased skimmed milk from that entity. The assessee made purchases of Rs.8.08 Crores from that entity and made payment of Rs.15.35 Crores. Such huge transactions were made within a span of two months. The assessee received funds from M/s Sterling Agro Industries Ltd. and the same were, in turn, transferred to M/s Nandan Dairy Products. The same was further transferred by M/s Nandan Dairy Products to M/s Sterling Agro Industries Ltd. The Ld. AO estimated alleged commission income on accommodation entry @3% and added the same to the income of the assessee. 3. During first appeal, the assessee duly summarized the bank credits which are extracted on Page Nos. 38 & 39 of the impugned order. The assessee received loans from M/s Acme Resources Ltd and M/s Vinay Real Estate which were considered to be accommodation entries. However, it was demonstrated that the assessee advanced loans to these entities and earned interest income. With respect to M/s Upma Dairy, it was shown that the amount was received as chilling charges which was offered for taxation. With respect to M/s Abhishek Milk, it was demonstrated that the assessee received loan from this entity. The assessee received advance from M/s Sai Milk Chilling Center which was subsequently returned by the assessee. It was similarly demonstrated that the assessee sold milk to M/s Sterling Agro Industries Ltd. In other words, the assessee successfully explained each of the bank credit. Concurring with the same, Ld. CIT(A) deleted the impugned addition against which the revenue is in further appeal before us. 3 4. The aforesaid findings in the Impugned order remain uncontroverted before us. It could be seen that learned AO estimated commission on total bank credits. However, the assessee successfully explained each of the bank credit and established the fact that all the transactions were duly been reported in the audited books of accounts and offered to taxation wherever the receipts were in the nature of income. Under these circumstances, no fault could be found in the adjudication of Ld. CIT(A). 5. The appeal stand dismissed. Order pronounced u/r 34(4) of Income Tax (Appellate Tribunal) Rules, 1963. Sd/- Sd/- (SATBEER SINGH GODARA) (MANOJ KUMAR AGGARWAL) Ɋाियक सद˟ /JUDICIAL MEMBER लेखा सद˟ /ACCOUNTANT MEMBER Dated: 23-04-2025 आदेश की Ůितिलिप अŤेिषत / Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT AGRA "