Appeal Details
Counselvise Citation
[2013] 140 COUNSELVISE.COM (IT) 70478 (ITAT-KOLKATA)
Assessee PAN
Bench
Appeal Number
CRN Number
Duration Of Justice
1 year(s) 2 month(s) 25 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
19-12-2013
Appeal Filed By
Assessee
Bench Allotted
A
Assessment Year
2009-2010
Appeal Filed On
24-09-2012
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH A KOLKATA BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI ABRAHAM.P.GEORGE, ACCOUNTANT MEMBER ITA NO. 1363 - 1364 / KOL / 2012 ASSESSMENT YEARS :2009-10 & 2010-11 MRITYUNJAY KR. SHARMA C/O S.K. KHETAN, ROOM NO. 104, 46,B.B.GANGULY STREET, KOLKATA 700 012 [ PAN NO.AUXPS 5174 J ] V/S . DCIT,CENTRAL CIRCLE- XIII, KOLKATA, 18 RABINDRA SARANI, 5 TH FLOOR, KOLKATA 700001 / APPELLANT .. / RESPONDENT) /BY ASSESSEE SHRI K.K. CHHAPARIA, AR /BY REVENUE SHRI VARINDER MEHTA, CIT-DR /DATE OF HEARING 26-11-2013 ! /DATE OF PRONOUNCEMENT 19-12-2013 ' ' ' ' / // / O R D E R PER MAHAVIR SINGH, JUDICIAL MEMBER:- BOTH THESE APPEALS BY ASSESSEE ARE ARISING OUT OF DIFFERENT ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) CENTRAL-II, KO LKATA IN APPEALS NO.167- 168/CC-XIIICIT(A)-II/11-12 DATED 16-07-2012 & 17-07 -2012. THE ASSESSMENTS WERE FRAMED BY DCIT,CC-XIII, KOLKATA U/S143(3)/153A OF THE INCOME TAX ACT, 1961(HEREINAFTER REFERRED TO AS THE ACT) FOR ASSE SSMENT YEAR (AY) 2009-10 AND 2010-11 VIDE HIS ORDER DATED 17-10-2011. 2. THE ONLY COMMON ISSUE IN THESE TWO APPEALS OF AS SESSEE AGAINST THE ORDER OF CIT(A) CONFIRMING THE ACTION OF ASSESSING OFFICE R IN APPLYING INCORRECT PEAK CREDIT. FOR THIS, ASSESSEE HAS RAISED SIX COMMON G ROUNDS IN BOTH YEARS EXCEPT ITA NO.1363-64/KOL2012 A.YS. 09-10& 10 -11 MRITYUNJAY KR. SHARMA V. DCI,CC-XIII,KOL PAGE 2 THE AMOUNT OF ASSESSMENT UNDER CHALLENGED AT RS.5.0 5 LAKH IN AY 2009-10 AND RS.39.95 LAKH IN AY 2010-11. 3. BRIEFLY STATED FACTS ARE THAT A SEARCH OPERATION U/S. 132 OF THE ACT WAS CARRIED OUT BY INCOME-TAX DEPARTMENT ON 08-12-2009 AND ON SUBSEQUENT DATES ON SHASHI KANT KHETAN GROUP. DURING THE COURSE OF SEAR CH, FIVE BANK ACCOUNTS IN THE NAME OF ASSESSEE'S PROPRIETORSHIP CONCERNS, NAMELY M/S. OM SUPPLIERS, MS. BALAJI GARMENTS, M/S. AMBIKA TRADERS AND M/S. TRIAN GLE TRADING WERE FOUND. APART FROM THE ABOVE, ASSESSEE WAS ALSO OWNED THREE MORE BANK ACCOUNTS IN THE PROPERTY CONCERN, NAMELY, M/S ANNAPURNA TRADING, M/ S. RAJAT ENTERPRISES AND M/S VENUS ENTERPRISES. DURING THE COURSE OF SEARCH, THE STATEMENT OF THE ASSESSEE WAS RECORDED AND IT WAS ADMITTED BY HIM THAT ALL HI S PROPRIETOR CONCERNS WERE ENGAGED IN THE BUSINESS OF PROVIDING ACCOMMODATION ENTRIES TO VARIOUS PARTIES IN LIEU OF COMMISSION INCOME @ 0.50% OF THE TOTAL CASH DEPOSIT. IN THESE UNDISCLOSED BANK ACCOUNTS, THE ASSESSEE IN AY 2009- 10 HAS GIVEN THE WORKING OF PEAK BALANCE OF UNDISCLOSED BANK ACCOUNT AT RS.10,8 1,450/- AND THE RELEVANT PARA OF THE ASSESSING OFFICER READS AS UNDER:- WORKING OF PEAK BALANCE ON UNDISCLOSED BANK ACCOUNT S THE INITIAL CASH DEPOSIT IN THE AFORESAID ACCOUNT W AS MADE OUT OF MY PAST SAVINGS. OTHER THAN THE INITIAL CASH DEPOSITS, NO OTHER DEPO SITS IN THE ACCOUNT REPRESENT MY MONEY. HOWEVER, OVER THE PERIOD SOME PART OF THE UN DISCLOSED COMMISSION INCOME GOT ACCUMULATED IN THE BANK ACCOUNTS. I CATE GORICALLY SUBMIT THAT NO WITHDRAWALS IN THE ACCOUNT REPRESENTS MY OWN INVEST MENTS OR DRAWINGS. THUS, PEAK BALANCE HAS BEEN CONSIDERED AS HIGHER OF INITI AL CASH DEPOSITS IN THE BANK AND THE CLOSING BALANCE (BEING AMOUNT SEIZED BY THE INCOME TAX DEPARTMENT DURING THE SEARCH). THUS THE PEAK BALANCE HAS BEEN CALCULATED AS UNDER:- A/C HOLDER NAME OF THE BANK AND A/C NO. PEAK BALANCE (RS) DATE REMARKS OM SUPPLIERS INDUSLND BANK, A/C NO- 15AA1203050 1,01,750/- 02-02-2010 AMOUNT SEIZED BY I.T. DEPT. RS.1,01,750- .INITIAL DEPOSIT ON 28-08-2009 RS.1,00,000- OM SUPPLIERS INDIAN OVERSEAS BANK, AC NO-18390 5,000- 24-06-2009 INITIAL DEPOSIT IN THE ACCOUNT BALAJI STANDARD CHARTERED 24-06-2009 INITIAL DEPOS IT IN ITA NO.1363-64/KOL2012 A.YS. 09-10& 10 -11 MRITYUNJAY KR. SHARMA V. DCI,CC-XIII,KOL PAGE 3 GARMENTS BANK, A/C NO- 3310145116 1,00,000- THE ACCOUNT AMBIKA TRADERS DEVELOPMENT CREDIT BANK, A/C NO 8921300001106 4,74,700/- 29-01-2010 AMOUNT SEIZED BY I.T. DEPT RS.4,74,700/-. INITIAL DEPOSIT ON 04-03-2009 RS.1,00,000- TRIANGLE TRADING STANDARD CHARTERED BANK, A/C NO- 33105141129 1,00,000/- 30-10-2009 INITIAL DEPOSIT IN THE ACCOUNT ANNAPURNA TRADING STANDARD CHARTERED BANK, AC NO- 33105138608 1,00,000/- 24-06-2009 INITIAL DEPOSIT IN THE ACCOUNT RAJAT ENTERPRISES STANDARD CHARTERED BANK, A/C NO- 33105138470 1,00,000- 24-06-2009 INITIAL DEPOSIT IN THE ACCOUNT VENUS ENTERPRISES STANDARD CHARTERED BANK, A/C NO- 33105139698 1,00,000/- 27-06-2009 INITIAL DEPOSIT IN THE ACCOUNT THUS MY PEAK BALANCE COMES TO RS.10,81,450-. IT CAN BE SEEN THAT THE BANK ACCOUNT CONTAIN SUBSTA NTIAL DEPOSITS AND WITHDRAWAL ON DIFFERENCE DATES, HOWEVER, THE DEPOSITS IN A PAR TICULAR ACCOUNT OTHER THAN THE INITIAL DEPOSIT REFERRED ABOVE WAS LYING IN MY ACCO UNT FOR NOT MORE THAN TWO WORKING DAYS, WHICH IS THE PERIOD OF ROTATION OF FU NDS. THUS, MY OWN FUNDS IN THE ACCOUNT CAN ONLY BE CONSIDERED AS PEAK BALANCE. IT IS IMPORTANT TO MENTION THAT MY PEAK BALANCE REFERRED TO ABOVE OF RS.10,81,450- REPRESENT PARTLY MY PAST SAVINGS AND THE BALANCE BEING PART OF ACCUMULATED U NDISCLOSED EARNINGS AS PER DETAILS BELOW:- OUT OF PAST SAVINGS RS.7,05,000- UNDISCLOSED COMMISSION INCOME RS.3,76,450- RS.7,05,000 SINCE RS.3,76,450- HAS ALREADY BEEN COVERED IN MY C OMMISSION INCOME OFFERED IN MY RETURN, I AM VOLUNTARILY OFFERING RS.7,05,000/- (UNDER PEAK CREDIT THEORY) AS MY INCOME OVER AND ABOVE MY COMMISSION INCOME. THIS OF FERING HAS BEEN MADE TO AVOID LITIGATIONS THOUGH I AM AWARE THAT SECTION 68 IS NOT APPLICABLE ON ME. THE BREAK OF RS.7,05,000- IS AS UNDER:- ASSESSMENT YEAR AMOUNT OFFERED 2009-10 RS.1,00,000/- 2010-11 RS.6,05,000- HOWEVER, THIS OFFERING IS MADE WITH AN UNDERSTANDIN G THAT I SHALL NOT BE SUBJECT TO ANY PENAL PROCEEDINGS. I REITERATE THAT THIS AMOUNT DOESNT REPRESENT MY INCOME OR ITA NO.1363-64/KOL2012 A.YS. 09-10& 10 -11 MRITYUNJAY KR. SHARMA V. DCI,CC-XIII,KOL PAGE 4 SUBJECT TO TAXATION U/S. 68 OF INCOME TAX ACT. THE OFFERING HAS BEEN MADE TO AVOID FUTURE LITIGATIONS AND PENAL PROCEEDINGS AND IN GOO D FAITH. I REITERATE THAT THIS OFFERING MAY BE ACCEPTED PROVIDED NO PENAL PROCEEDI NGS ARE INITIATED AGAINST ME. IT CAN BE SEEN THAT THE BANK ACCOUNT CONTAIN SUBSTA NTIAL DEPOSITS 4. SIMILARLY, FOR AY 2010-11, THE ASSESSEE HAS GIVE N THE PEAK WORKING AS UNDER:- WORKING OF PEAK BALANCE ON UNDISCLOSED BANK ACCOUN TS THE INITIAL CASH DEPOSIT IN THE AFORESAID ACCOUNT W AS MADE OUT OF MY PAST SAVINGS. OTHER THAN THE INITIAL CASH DEPOSITS, NO OTHER DEPO SITS IN THE ACCOUNT REPRESENT MY MONEY. HOWEVER, OVER THE PERIOD SOME PART OF THE UN DISCLOSED COMMISSION INCOME GOT ACCUMULATED IN THE BANK ACCOUNTS. I CATE GORICALLY SUBMIT THAT NO WITHDRAWALS IN THE ACCOUNT REPRESENTS MY OWN INVEST MENTS OR DRAWINGS. THUS, PEAK BALANCE HAS BEEN CONSIDERED AS HIGHER OF INITI AL CASH DEPOSITS IN THE BANK AND THE CLOSING BALANCE (BEING AMOUNT SEIZED BY THE INCOME TAX DEPARTMENT DURING THE SEARCH). THUS THE PEAK BALANCE HAS BEEN CALCULATED AS UNDER:- A/C HOLDER NAME OF THE BANK AND AC NO. PEAK BALANCE (RS) DATE REMARKS OM SUPPLIERS INDUSLND BANK, A/C NO. 0515AA1203050 1,01,750- 02-02-2010 AMOUNT SEIZED BY I.T. DEPT RS.1,01,750/- INITIAL DEPOSIT ON 28-08-2009 RS.1,00,000- OM SUPPLIERS INDIAN OVERSEAS BANK, A/C. NO 18390 5,000/- 24-06-2009 INITIAL DEPOSIT IN THE ACCOUNT BALAJI GARMENTS STANDARD CHARTERED BANK, A/C NO.- 33105145116 1,00,000/- 24-06-2009 INITIAL DEPOSIT IN THE ACCOUNT AMBIKA TRADERS DEVELOPMENT CREDIT BANK, A/C NO 8921300001106 4,74,700/- 29-01-2010 AMOUNT SEIZED BY I.T. DEPT. RS.4,74,700- INITIAL DEPOSIT ON 04-03-2009 RS.1,00,000/- TRIANGLE TRADING STANDARD CHARTERED BANK, AC NO- 33105141129 1,00,000- 30-10-2009 INITIAL DEPOSIT IN THE ACCOUNT ANNAPURNA STANDARD 24-06-2009 INITIAL DEPOSIT ITA NO.1363-64/KOL2012 A.YS. 09-10& 10 -11 MRITYUNJAY KR. SHARMA V. DCI,CC-XIII,KOL PAGE 5 TRADING CHARTERED BANK, A/C NO- 33105138608 1,00,000/- IN THE ACCOUNT RAJAT ENTERPRISES STANDARD CHARTERED BANK, A/C NO.- 33105118470 1,00,000/- 24-06-2009 INITIAL DEPOSIT IN THE ACCOUNT VENUS ENTERPRISES STANDARD CHARTERED BANK, A/C NO.- 33105139698 1,00,000- 27-06-2009 INITIAL DEPOSIT IN THE ACCOUNT THUS MY PEAK BALANCE COMES TO RS.10,81,450-. IT CAN BE SEEN THAT THE BANK ACCOUNT CONTAIN SUBSTA NTIAL DEPOSITS AND WITHDRAWAL ON DIFFERENCE DATES, HOWEVER, THE DEPOSITS IN A PAR TICULAR ACCOUNT OTHER THAN THE INITIAL DEPOSIT REFERRED ABOVE WAS LYING IN MY ACCO UNT FOR NOT MORE THAN TWO WORKING DAYS, WHICH IS THE PERIOD OF ROTATION OF FU NDS. THUS, MY OWN FUNDS IN THE ACCOUNT CAN ONLY BE CONSIDERED AS PEAK BALANCE. IT IS IMPORTANT TO MENTION THAT MY PEAK BALANCE REFERRED TO ABOVE OF RS.10,81,450- REPRESENT PARTLY MY PAST SAVINGS AND THE BALANCE BEING PART OF ACCUMULATED U NDISCLOSED EARNINGS AS PER DETAILS BELOW:- OUT OF PAST SAVINGS RS.7,05,000- UNDISCLOSED COMMISSION INCOME RS.3,76,450- RS.7,05,000 SINCE RS.3,76,450- HAS ALREADY BEEN COVERED IN MY C OMMISSION INCOME OFFERED IN MY RETURN, I AM VOLUNTARILY OFFERING RS.7,05,000/- (UNDER PEAK CREDIT THEORY) AS MY INCOME OVER AND ABOVE MY COMMISSION INCOME. THIS OF FERING HAS BEEN MADE TO AVOID LITIGATIONS THOUGH I AM AWARE THAT SECTION 68 IS NOT APPLICABLE ON ME. THE BREAK OF RS.7,05,000- IS AS UNDER:- ASSESSMENT YEAR AMOUNT OFFERED 2009-10 RS.1,00,000/- 2010-11 RS.6,05,000- HOWEVER, THIS OFFERING IS MADE WITH AN UNDERSTANDIN G THAT I SHALL NOT BE SUBJECT TO ANY PENAL PROCEEDINGS. I REITERATE THAT THIS AMOUNT DOESNT REPRESENT MY INCOME OR SUBJECT TO TAXATION U/S. 68 OF INCOME TAX ACT. THE OFFERING HAS BEEN MADE TO AVOID FUTURE LITIGATIONS AND PENAL PROCEEDINGS AND IN GOO D FAITH. I REITERATE THAT THIS OFFERING MAY BE ACCEPTED PROVIDED NO PENAL PROCEEDI NGS ARE INITIATED AGAINST ME. BUT THE ASSESSING OFFICER IN BOTH YEARS HAS NOT ACC EPTED THE PLEA OF THE ASSESSEE AND ASSESSED THE PEAK CREDIT OF RS.5,05 LAKH IN AY 2009-10 AND ASSESSED PEAK CREDITED OF RS.39.95 LAKHS IN AY 2010-11. AGGRIEVED , ASSESSEE PREFERRED APPEAL ITA NO.1363-64/KOL2012 A.YS. 09-10& 10 -11 MRITYUNJAY KR. SHARMA V. DCI,CC-XIII,KOL PAGE 6 BEFORE CIT(A), WHO IN BOTH YEARS PASSED IDENTICALLY WORDED ORDERS EXCEPT THE AMOUNT OF PEAK. CIT(A) IN PARA-5 IN AY 2009-10 HA S HELD AS UNDER:- 5. I HAVE CONSIDERED THE SUBMISSION OF THE APPELLA NT AND PERUSED THE ASSESSMENT ORDER. ON FACTS THERE IS NO DISPUTE THAT IN THE COU RSE OF SEARCH OPERATION IT WAS GATHERED THAT THE APPELLANT WAS MAINTAINING BANK AC COUNTS IN THE NAME OF HIS PROPRIETORSHIP CONCERNS AND, ADMITTEDLY, THESE BANK ACCOUNTS WERE UNDISCLOSED. THERE IS ALSO NO DISPUTE ON THE FACT THAT THE APPEL LANT WAS ENGAGED IN THE ACTIVITY OF PROVIDING ACCOMMODATION ENTRIES TO VARIOUS BENEF ICIARY PARTIES. THAT, THE APPELLANT USED TO DEPOSIT THE CASH IN HIS BANK ACCO UNTS AND ISSUING THE CHEQUES TO BE REACHED TO ULTIMATE BENEFICIARIES. IN THE BAN K ACCOUNTS THE CHEQUES WERE ALSO DEPOSITED WHICH WERE RECEIVED BY THE APPELLANT FROM THE PERSONS WORKING IN THE CHAIN OF PROVIDING ACCOMMODATION ENTRIES. IT IS CLAIMED BY THE APPELLANT THAT HE WAS RECEIVING THE COMMISSION FOR THE SERVICES RE NDERED TO THE BENEFICIARIES FOR PROVIDING BOOK ENTRIES AND THE COMMISSION WAS CHARG ED ONLY ON THE AMOUNT OF CASH DEPOSITS AND THE RATE VARIES FROM 25P TO 50P. IN THE COURSE OF SEARCH OPERATION, THE APPELLANT DISCLOSED COMMISSION INCOM E @ 0.50% ON THE AMOUNT OF CASH DEPOSITED IN THE UNDISCLOSED BANK ACCOUNTS AND SAME WAS SHOWN IN THE RETURN OF INCOME FILED FOR THE YEAR UNDER CONSIDERA TION. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO ASKED VARIOUS DETAIL S FROM THE APPELLANT LIKE, SOURCE OF CASH DEPOSITED IN THE BANK ACCOUNTS, NAME AND ADDRESSES OF THE IMMEDIATE AND ULTIMATE BENEFICIARIES AND THE NAME A ND ADDRESSES OF THE PERSONS FROM WHOM CASH AND CHEQUES WERE RECEIVED BY HIM. TH E AO ALSO ASKED AS WHY PROVISIONS OF SECTION 68 OF THE ACT SHOULD NOT BE I NVOKED. IN RESPONSE, IT WAS SUBMITTED BEFORE THE AO THAT THE APPELLANT HAS NOT MAINTAINED ANY BOOKS OF ACCOUNT OR RECORDS OF THE PERSONS FOR WHOM WORK WAS DONE AND, THEREFORE, HE WAS NOT IN THE POSITION TO PROVIDE ANY DETAILS OF THE P ERSONS AS CALLED FOR BY THE AO. IT WAS ALSO SUBMITTED BY THE APPELLANT THAT THE PROVIS IONS OF SECTION 68 OF THE ACT ARE NOT APPLICABLE IN HIS CASE BECAUSE NO SUM WAS FOUND CREDITED IN HIS BOOKS OF ACCOUNT AND THAT THE BANK PASSBOOK OR THE BANK STAT EMENT CANNOT BE TREATED AS APPELLANTS BOOKS OF ACCOUNT. HOWEVER, THE APPELLAN T CAME FORWARD WITH THE ALTERNATE PLEA THAT KEEPING IN VIEW THE NATURE OF A CTIVITIES CARRIED ON BY HIM, IN HIS CASE, AT THE MOST PEAK CREDIT THEORY MAY BE APPLIED AND THE PEAK CREDIT MAY BE ASSESSED IN HIS HANDS. IN SUPPORT OF THIS PLEA, THE APPELLANT RELIED ON VARIOUS DECISIONS OF ITAT, KOLKATA. THE APPELLANT WORKED OU T THE PEAK CREDIT AT RS,1,00,000/- AND OFFERED THE SAME FOR TAX. THE AO, IN PRINCIPLE ACCEPTED THE CONTENTION OF THE APPELLANT THAT IN HIS CASE PEAK C REDIT THEORY IS APPLICABLE TO ASSESS THE INCOME. HOWEVER, HE DID NOT ACCEPT THE C ONTENTION OF THE APPELLANT THAT PROVISIONS OF SECTION 68 ARE NOT APPLICABLE IN HIS CASE. HE ALSO DID NOT ACCEPT THE WORKING OF PEAK CREDIT PROVIDED BY THE APPELLANT TO OFFER THE SUM OF RS.1,00,000/- FOR TAX. THE AO WAS OF THE OPINION THAT THE APPELLA NT HAS SIMPLY OFFERED THE AMOUNT OF INITIAL DEPOSITS MADE IN THE BANK ACCOUN TS, AS PEAK BALANCE. AFTER REJECTING THE WORKING OF THE APPELLANT, THE AO HIMS ELF WORKED OUT THE PEAK CREDIT TAKING INTO ACCOUNT ALL THE ENTRIES IN THE UNDISCLO SED BANK ACCOUNTS AND ARRIVED ON A COMBINED PEAK FIGURE OF RS.5,05,000/-. THE SAID A MOUNT OF PEAK IS ADDED BY THE AO TO THE INCOME OF THE APPELLANT. THE AO ALSO ADD THE INCOME ON ACCOUNT OF COMMISSION AS DISCLOSED BY THE APPELLANT IN THE RET URN OF INCOME. IN THE COURSE OF APPELLATE PROCEEDINGS THE APPELLANT HAS ARGUED THAT THE AO HAS WORKED OUT THE EXCESSIVE PEAK AMOUNT AND SECONDLY, ONCE THE AO HAS ADDED THE PEAK AMOUNT HE SHOULD HAVE NOT ADDED THE COMMISSION INCOME AGAI N BECAUSE THE COMMISSION ITA NO.1363-64/KOL2012 A.YS. 09-10& 10 -11 MRITYUNJAY KR. SHARMA V. DCI,CC-XIII,KOL PAGE 7 IS PART OF THE PEAK AND SAME WAS REDEPLOYED IN BANK BALANCE. ON CAREFUL CONSIDERATION OF THE FACTS, I AM OF THE OPINION THA T THE AO HAS RIGHTLY INVOKED PROVISIONS OF SECTION 68 OF THE ACT AND HAS ALSO RI GHTLY APPLIED THE COMBINED PEAK THEORY AFTER CONSIDERING ALL THE ENTRIES IN THE UND ISCLOSED BANK ACCOUNTS. THE RELIANCE IS PLACED ON THE DECISION IN THE CASE OF ITO WARD 36(4),KOLKATA VS. UDAY SHANKARMAHAWAR, ITA NO.1903KOL2009, CIT VS.PRAVEEN KUMAR AGARWAL, IT(SS)A NO.61 &74KOL/2003 AND CIT VS. LOKNATH PRASAD GUPTA, IT(SS)A NO.185 & 190/KOL/2003 , WHEREIN ON SIMILAR ISSUE THE HONBLE ITAT, KOLKATA UPHELD THE ADDITION TO THE INCOME BY COMBINED PEAK CREDIT THEO RY. I AM OF THE OPINION THAT THE AO WAS JUSTIFIED IN REJECTING THE PEAK AMOUNT WORKE D OUT BY THE APPELLANT BECAUSE IT WAS NOTHING BUT THE AMOUNT OF INITIAL DEPOSITS M ADE IN THE UNDISCLOSED ACCOUNT. HE HAS NOT CONSIDERED ALL THE ENTRIES OF THE BANK A CCOUNTS TO ARRIVE ON THE FIGURE OF PEAK. UNDER THE CIRCUMSTANCES, I FIND NO REASON TO DISTURB THE PEAK AMOUNT ARRIVED BY THE AO TO MAKE THE ADDITION TO THE INCOM E OF THE APPELLANT AND, THEREFORE, THE ACTION OF THE AO MAKING ADDITION OF RS.5,05,000/- IS UPHELD. I AM ALSO NOT INCLINED TO AGREE WITH THE SUBMISSION OF T HE APPELLANT THAT IF ONCE THE AO HAS ADDED PEAK CREDIT, THEN THE COMMISSION INCOME C ANNOT BE ADDED TO THE INCOME OF APPELLANT. THERE IS NO DISPUTE ON THE FAC T THAT THE APPELLANT HAD EARNED COMMISSION INCOME WHICH WAS ADMITTED BY HIM AND ACC ORDINGLY ALSO DISCLOSED IN THE RETURN OF INCOME. IN VIEW OF ABOVE, THE ADDITIO N ON ACCOUNT OF COMMISSION INCOME IS ALSO CONFIRMED. THE GROUND NOS. 1, 2 AND THE ADDITIONAL GROUND ARE DISMISSED . AGGRIEVED IN BOTH YEARS ASSESSEE IS IN SECOND APPEA L BEFORE US. 5. WE HAVE HEARD RIVAL CONTENTIONS AND GONE THOUGH FACTS AND CIRCUMSTANCES OF THE CASE. BEFORE US ALSO THE ASSESSEE'S COUNSEL ASKED FOR SUSTAINING ONLY ONE ADDITION I.E. EITHER PEAK CREDIT OR COMMISSION ON A CCOUNT OF ACCOMMODATION ENTRIES. THE ASSESSEE ADMITTED THAT IT IS NOT MAINT AINING THE BOOKS OF ACCOUNT AND THE TOTAL CASH DEPOSIT IN AY 2009-10 IS AT RS.18.55 LAKH AND IN AY 2010-11 IS AT RS.20,52,02,500/- AND THE ASSESSEE HAS GIVEN WORKIN G OF UNDISCLOSED INCOME OF COMMISSION @ 0.50% THAT MEANS ACCORDING TO ASSESSEE , THE COMMISSION IN AY 2009-10 IS AT RS.9,275/- AND IN AY 2010-11 IT IS RS .10,26,013/-, AS AGAINST THE SAME, ASSESSEE HAS OFFERED AMOUNT IN AYS 2009-10 AN D 2010-11 AT RS.1 LAKH AND RS.6.50 LAKH RESPECTIVELY. WE HAVE GONE THROUGH THE FACTS IN ENTIRETY INCLUDING THE PAPER BOOK FILED BY THE ASSESSEE AND CASE LAWS CITED. ADMITTEDLY, ,THE ASSESSING OFFICER HAS TO COMPUTE THE UNEXPLAIN ED CASH DEPOSITS BY APPLYING PEAK CREDITS. THE AO SHOULD HAVE EXAMINED THE SOURC E OF THE CASH DEPOSITS IN THE BANK ACCOUNTS, NAME AND ADDRESS OF THE IMMEDIATE AN D ULTIMATE BENEFICIARIES AND ITA NO.1363-64/KOL2012 A.YS. 09-10& 10 -11 MRITYUNJAY KR. SHARMA V. DCI,CC-XIII,KOL PAGE 8 THE NAME AND ADDRESS OF THE PERSONS FROM WHOM CASH AND CHEQUE WERE RECEIVED BY ASSESSEE. BECAUSE, IF THE ASSESSEE WANTS THAT AS SESSMENT BE FRAMED ON PEAK OF THE CREDITS, THE ASSESSEE HAS TO EXPLAIN HOW THE TRANSACTIONS ARE CARRIED OUT AND WHETHER THE CASH WITHDRAWALS ARE UTILIZED FOR I NVESTMENTS OR NOT. THE AO SHOULD HAVE VERIFIED THE BENEFICIARIES OF THE ACCOM MODATION ENTRIES AND IN TERM OF THIS, WE SET ASIDE THIS COMMON ISSUE TO THE FILE OF AO FOR VERIFICATION OF THE FACTS IN ENTIRETY BECAUSE EVEN FOR ASSESSING THE PEAK CREDIT S, THESE ARE NECESSARY INGREDIENTS. HENCE, THESE TWO APPEALS OF ASSESSEE A RE SET ASIDE TO THE FILE OF AO FOR VERIFICATION OF FACTS AND FRESH ADJUDICATION AC CORDING TO LAW. APPEALS ARE ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, BOTH THE APPEALS OF ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 19 TH DEC., 2013 SD/- SD/- (ABRAHAM.P. GEORGE) (MAHAVIR S INGH) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) KOLKATA, *DKP #$%- 19 /12/2013 + ' ' ' ' ,,- ,,- ,,- ,,- .- .- .- .- / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. $0$,1 2 / CONCERNED CIT 4. 2- / CIT (A) 5. - 56 ,,,1, ,1!, / DR, ITAT, KOLKATA 6. 69: ;< / GUARD FILE. BY ORDER/ ' , =/> $ ,1!,
Other Referred Cases
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1:1 Consultation on Salary Structuring
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Consultation on Entity Formation
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1:1 Consultation on Business Development
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Research Collaboration Agreement
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Memorandum Amendment Resolution
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