INCOME TAX OFFICER, PIRAMAL CHAMBERS V. AMISHA SUDHIR BHATT, MUMBAI

ITA 6313/MUM/2024

AI Insights

The case involves appeals by the Income Tax Officer against the order of the National Faceless Appeal Center/Commissioner of Income Tax (Appeals), which initially restricted the addition to 1% of the accommodation entries claimed by the Assessee, Amisha Sudhir Bhatt, for the Assessment Years 2010-11 and 2011-12. The Tribunal considered the arguments and precedents presented, including the judgment in PCIT vs Buniyad Chemicals Ltd., and decided to enhance the addition to 5% of the accommodation entries. The Tribunal's decision aimed at substantial justice and reducing prolonged litigation.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 633201 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2025
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Other Referred Cases: PCIT vs Buniyad Chemicals Ltd. (2025)172 Taxman.com 462 (Bombay)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KAVAN LIMBASIYA; LD.
• Assessee Lawyers: SHARWAN KUMAR JHA
• Keywords: Accommodation entries
• Section: 68

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH “SMC”, MUMBAI BEFORE SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER ITA No.6314/M/2024 Assessment Year: 2010-11 & ITA No.6313/M/2024 Assessment Year: 2011-12 Income Tax Officer 501, 5th Floor Piramal Chambers Lalbaug, Mumbai-400012 Vs. Amisha Sudhir Bhatt 43 Jariwala Bldg, 497 Arthur Rd. Tardeo, Mumbai- 400034 PAN: AAFPB1103L (Appellant) (Respondent) Present for: Assessee by : Shri Sharwan Kumar Jha Revenue by : Shri Kavan Limbasiya, Ld. Sr.D.R. Date of Hearing : 10.06.2025 Date of Pronouncement : 10.06.2025 O R D E R Per: Narender Kumar Choudhry, Judicial Member: These appeals have been preferred by the Assessee against the even order dated 04.10.2024, impugned herein, passed by the National Faceless Appeal Center (NFAC)/ Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the Assessment Year (A.Ys.) 2010-11 and 2011-12. 2. As both the appeal are having involved identical facts and issue and therefore for the sake of brevity, the same were heard together and are being dispose off by this composite order and by taking into consideration ITA No.6314/M/2024 (AY: 2010-11) as a lead case. ITA No. 6313 & 6314/M/2024 Amisha Sudhir Bhatt 2 3. In ITA No.6314/M/2024, though the Ld. DR. has relied on the judgment passed by the PCIT vs Buniyad Chemicals Ltd. (2025)172 Taxman.com 462 (Bombay), wherein the Hon’ble High court in para no. 20 has held that CIT(A) has adopted a fair approach by stating that if the respondent-Assessee identifies the beneficiaries, then the rate of commission adopted should 0.3% of such identified beneficiaries and if the respondent-Assessee fails to identify the beneficiaries, then in that case the sum credited in the books of account, would stand confirmed u/s 68 of the Act. Therefore, this judgment and particular finding of the Hon’ble High court favors the case of the Assessee, as in the Assessee’s case the Assessee has identified the beneficiaries and claimed to be a conduit for providing accommodation entries, as held by the Ld. Commissioner in the impugned order and therefore the Ld. Commissioner restricted the addition to the tune of @ 1% of the accommodation entries of Rs. 35,05,050/-. 4. The Ld. DR somehow praying for upholding the addition @ 100% of the accommodation entries or alternatively enhancement of addition to a reasonable percentage, as against @ 1% as restricted by the Ld. Commissioner. 5. On the contrary, the Ld. AR. of the Assessee though has prayed for affirmation of the impugned order, however alternatively prayed that the addition if any to be restored as made by the AO, can be enhanced at reasonable percentage of 3% to 5%. 6. Thus, in order to cut short, the litigation and for substantial justice, this court is inclined to enhance the addition restricted @ 1% by the Ld. Commissioner, to 5% of the accommodation entries amounting to Rs. 35,05,050/- and thus the AO is directed to made the addition @ 5% of the accommodation entries and recompute the Assessee’s tax liability accordingly. ITA No. 6313 & 6314/M/2024 Amisha Sudhir Bhatt 3 7. Resultantly, the appeal filed by the Revenue Department is partly allowed. 8. In the result, in view of the judgment in ITA 6313/M/24, both the appeals are partly allowed in the same terms. Order pronounced in the open court on 10.06.2025. Sd/- (NARENDER KUMAR CHOUDHRY) JUDICIAL MEMBER * Disha Raut, Stenographer Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The DR Concerned Bench //True Copy// By Order Dy./Asstt. Registrar, ITAT, Mumbai. "