ACIT, Central circle-263, New Delhi V. Naresh Kumar Jian, New Delhi

ITA 1750/DEL/2019

AI Insights

The case involves cross-appeals by Naresh Kumar Jain and the Deputy Commissioner of Income Tax (DCIT), Central Circle 26, concerning the assessment years 2010-11 to 2016-17. The primary issues revolved around the rate of commission income applied to accommodation entries and the treatment of unexplained cash credits. The ITAT consolidated the appeals due to the commonality of issues and precedents set in similar cases involving the assessee's brother, Anand Kumar Jain. The Tribunal found that the commission rate of 0.47% previously established in Anand Kumar Jain's case should apply to Naresh Kumar Jain's cases as well. Furthermore, the Tribunal agreed with the CIT(A)'s decision to delete the protective addition of unexplained cash credits, noting that the income had already been taxed under substantive additions.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 113877 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 2 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-05-2023
• Appeal Filed By: Department
• Order Result: PartlyAllowed
• Bench Allotted: F
• Next Hearing Date: 09-05-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 28-02-2019
• Other Referred Cases: Anand Kumar Jain vs. DCIT
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Value adopted by valuation officer; Valuation report; Accommodation entries
• Section: 132; 92; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH ‘F’ : NEW DELHI) SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER and SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No.1325/Del./2019 (ASSESSMENT YEAR : 2010-11) ITA No.1326/Del./2019 (ASSESSMENT YEAR : 2011-12) ITA No.1327/Del./2019 (ASSESSMENT YEAR : 2012-13) ITA No.1328/Del./2019 (ASSESSMENT YEAR : 2013-14) ITA No.1329/Del./2019 (ASSESSMENT YEAR : 2014-15) ITA No.1330/Del./2019 (ASSESSMENT YEAR : 2015-16) ITA No.1331/Del./2019 (ASSESSMENT YEAR : 2016-17) Naresh Kumar Jain, vs. DCIT, Central Circle 26, 107, Savera Apartment, New Delhi. Sector 13, Rohini, New Delhi – 110 085. (PAN : ACCPJ9547R) ITA No.1749/Del./2019 (ASSESSMENT YEAR : 2010-11) ITA No.1750/Del./2019 (ASSESSMENT YEAR : 2011-12) ITA No.1751/Del./2019 (ASSESSMENT YEAR : 2012-13) ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 2 ITA No.1752/Del./2019 (ASSESSMENT YEAR : 2013-14) ITA No.1753/Del./2019 (ASSESSMENT YEAR : 2014-15) ITA No.1754/Del./2019 (ASSESSMENT YEAR : 2015-16) DCIT, Central Circle 26, vs. Naresh Kumar Jain, New Delhi. 107, Savera Apartment, Sector 13, Rohini, New Delhi – 110 085. (PAN : ACCPJ9547R) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri Ved Jain, Advocate Ms. Supriya Mehta, CA Shri Aman Garg, Advocate REVENUE BY : Shri T. Kipgen, CIT DR Date of Hearing : 10.05.2023 Date of Order : 24.05.2023 ORDER PER SHAMIM YAHYA, ACCOUNTANT MEMBER : These are cross appeals by the assessee and Revenue arising out of the respective orders of ld. CIT (Appeals) for the concerned assessment year. 2. Since the issues are common and connected and appeals were heard together, these are consolidated and disposed off by this common order for the sake of convenience. ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 3 3. One issue raised in assessee’s appeals relates to the confirmation by the ld. CIT (A) of the rate of commission income at 1.04%. We may refer to grounds of appeal, which are common in all the assessee’s appeals, from AY 2016-17 which read as under :- “1. On the facts and circumstances of the case, the order passed by the learned Commissioner of Income Tax (Appeals)[CIT(A)] is bad both in the eye of law and on facts. 2. (i) On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in restricting the addition to RS.2,37,66,799/- made by the AO on account of commission income treating the assessee as an accommodation entry provider. (ii) That the addition has been confirmed by arbitrarily applying the commission rate of 1.04% of the alleged turnover. 3. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in confirming the action of AO in holding that the assessee is an accommodation entry provider. 4. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in confirming the action of AO despite the fact that the addition has been made on the basis of extraneous considerations grossly indulging into surmises and conjectures. 5. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in confirming the action of AO despite the fact that the addition has been made by misinterpreting the statement of the assessee recorded on the oath. 6. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in confirming the action of AO despite the fact that the addition has been made by ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 4 drawing adverse inference, without taking the investigation, initiated by AO, to a logical end. 7. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in confirming the action of AO despite the fact that the addition has been made on the basis of material collected at the back of assessee without giving him an opportunity to rebut same. 8. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in confirming the action of AO despite the fact that the addition has been made by drawing adverse inference against the assessee on the basis of statement recorded without giving assessee an opportunity to cross examine the same. 9. Without prejudice to the above and in the alternative, the rate of commission applied by Ld. CIT(A) is too high and without any basis. 4. In Revenue’s appeals, one common issue relates to the challenge of ld. CIT (A)’s reducing the commission income to 1.04% against the AO’s determination @ 2%. We may refer grounds of appeal, which are common in all the Revenue’s appeals, from AY 2014-15 which read as under :- “On the facts and in the circumstances of the case, the ld.CIT(A) has erred in law and on facts in restrict addition at Rs.4,90,35,779/- as against the addition of Rs.23,10,02,265/- made in the assessment order on account of commission income from the accommodation entry business by taking the rate of l.04% for charging of commission income on the turnover of accommodation entries without considering the fact that in the assessment order the transactions among the shell concerns were already eliminated from the total turnover and the remaining transactions of commission were quantified @ 2% of total turnover.” ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 5 5. The Revenue has taken one more ground in all the assessment years which read as under :- “ITA No.1749/Del./2019 (AY: 2010-11) “On the facts and in the circumstances of the case, the ld.CIT (A) has erred in law and on facts in deleting the protective addition of Rs.6,85,000/- made by the AO on account of unexplained cash credits without considering the fact that the assessee has failed to produce directors of the shell concern to verify the identity of the company, genuineness of the transactions and creditworthiness of the concern.” ITA No.1750/Del./2019 (AY: 2011-12) “On the facts and in the circumstances of the case, the ld.CIT (A) has erred in law and on facts in deleting the protective addition of Rs.74,50,000/- made by the AO on account of unexplained cash credits without considering the fact that the assessee has failed to produce directors of the shell concern to verify the identity of the company, genuineness of the transactions and creditworthiness of the concern.” ITA No.1751/Del./2019 (AY: 2012-13) “On the facts and in the circumstances of the case, the ld.CIT (A) has erred in law and on facts in deleting the protective addition of Rs.43,60,000/- made by the AO on account of unexplained cash credits without considering the fact that the assessee has failed to produce directors of the shell concern to verify the identity of the company, genuineness of the transactions and creditworthiness of the concern.” ITA No.1752/Del./2019 (AY: 2013-14) “On the facts and in the circumstances of the case, the ld.CIT (A) has erred in law and on facts in deleting the protective addition of Rs.40,25,000/- made by the AO on account of unexplained cash credits without considering the fact that the assessee has failed to produce directors of the shell concern to ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 6 verify the identity of the company, genuineness of the transactions and creditworthiness of the concern. On the facts and in the circumstances of the case, the ld.CIT (A) has erred in deleting the addition of Rs.24,60,451/- on account of difference in the value of immovable property purchased by the assessee and the value determined by the DVO and inspector report treating the same as unaccounted investment u/s 69 of the Act without considering the fact that Inspector’s report was submitted after spot visit enquiries and after ascertaining the market value of this property through the property dealers of the area indicating the fair market value of the property.” ITA No.1753/Del./2019 (AY : 2014-15) “On the facts and in the circumstances of the case, the ld.CIT (A) has erred in law and on facts in deleting the protective addition of Rs.72,15,210/- made by the AO on account of unexplained cash credits without considering the fact that the assessee has failed to produce directors of the shell concern to verify the identity of the company, genuineness of the transactions and creditworthiness of the concern.” ITA No.1754/Del./2019 (AY : 2015-16) “On the facts and in the circumstances of the case, the ld.CIT (A) has erred in law and on facts in deleting the protective addition of Rs.24,00,000/- made by the AO on account of unexplained cash credits without considering the fact that the assessee has failed to produce directors of the shell concern to verify the identity of the company, genuineness of the transactions and creditworthiness of the concern.” 6. Apropos rate of commission : Since facts are identical we are referring to the facts and figures from AY 2016-17. The facts of the case are that a search and seizure operation u/s 132 of the Income-tax Act, 1961 (for short 'the Act') was carried out on 17.12.2015 on Sh. Anand ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 7 Kumar Jain and Sh, Naresh Kumar Jain (assessee) alongwith their various associates. The allegation on the assessee and his brother is that both of them use to maintain and operate various shell companies to provide accommodation entries and charge commission in respect of the same. Extensive enquiry / investigation was carried out during the course of search, post search investigation and assessment proceedings. The search operation was conducted at various premises including the office and residence of the assessee and his brother, residence of the partners / employees of the assessee and his brother. During the course of search various documentary evidences were found and seized by the department. The evidences and material found during the course of search includes documentary evidences in the form of cheque books, financial statements, bank statements, share certificates, acknowledgements of ITR, bank account opening and closing letters, authorization letters for attending the assessment proceedings, books of accounts in Tally format, copy of ledger accounts / confirmations. Further various statements of postman, employees & partners of the appellant and his brother and beneficiaries of the accommodation entries were recorded during the search and post search investigations which lead to the conclusion that the assessee and his brother were involved in providing accommodation entries in lieu of commission on the same. Enquires were also conducted from the bank of ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 8 the shell companies which also provided that 49 shell companions were controlled and managed by the assessee and his brother for providing accommodation entries. In view of these observations, the AO has added commission @2% in the hands of the assessee and his brother on the amount of accommodation entries. 7. Upon assessee’s appeal, ld. CIT (A) elaborately considered the issue and concluded as under :- “8.14 The above table shows that the appellant has received commission of Rs.22,06,16,047/- and made payments of Rs.15,13,52,004/- in short and excess a/c over the period of six years for the total turnover of the six years of Rs.1485,36,50,460/-. The average rate of commission received on total turnover herein above comes to 1.49% (Rs.22,06,16,047 / 1485,36,50,460*100). Whereas the average rate of commission paid comes to 1.02% (Rs.15,13,52,004 / 1485,36,50,460*100). Thus, the net commission rate in the tally data seized is search comes to 0.47%. The appellant in this regard, submitted that receipts net off of payment/expenses should be taxed in its hands as commission only. In this regard, the appellant has pointed out that seized record is the best evidence and when income is being considered on the basis of seized record, the expenses as recorded in the seized document also need to be deducted. It is only the net income, which is to be considered. I have examined the seized tally data. On going through the same, the contention of the appellant that expenses side represents the expense incurred by the appellant in arranging accommodation entries is found to be correct. However, in the facts and circumstances of the case, it will not be appropriate to allow deduction of entire expenses. Accordingly, taking a holistic view, I consider that 30% of the gross commission receipts (@1.49%) are the expenditure incurred for earning commission income. Accordingly, I find it appropriate to take rate of 1.04% (1.49%- 0.45%) for charging of commission income on the turnover of accommodation entries in the hands of the appellant. Here, it is also noticed that ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 9 there are some additional credit entries in the AD's data which are not appearing in the Jain folder tally data, accordingly it is logical to apply average rate of commission of 1.04% on the said additional credit entries as well. The. total turnover of the appellant will be as follows:- 8.15 In view of the above working the average rate of commission income of 1.04% will be charged in the hands of the appellant on the turnover of Rs.228,52,69,083/- for the year under consideration. Accordingly, the AO is directed to restrict addition at Rs.2,37,66,799/-.” 8. Against the above order, assessee and Revenue are in cross appeals before us. We have heard both the parties and perused the records. 9. Ld. Counsel of the assessee submitted that on identical issue of commission on accommodation entries, this ITAT in the case of brother ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 10 of the assessee, namely, Anand Kumar Jain has considered similar facts and passed an order whereby rate of commission on the accommodation entry has been determined as 0.47%. He submitted that his submissions shall be the same as in these appeals and he submitted that rate of commission adopted in that case will also be applied in the present cases as facts are similar. 10. Ld. DR for the Revenue, on the other hand, relied upon the order of AO. 11. Upon careful consideration, we note that identical issue was considered by the coordinate Bench of the Tribunal in the case of the brother of the assessee, Anand Kumar Jain in ITA Nos.1318 to 1324/Del/ 2019 and ITA Nos.2888 to 2894/Del/2019 vide order dated 28.04.2023. The adjudication of the ITAT is as under :- “ 7 . T h e m o o t i s s u e i n v o l v e d i n t h i s c a s e p e rt a i n t o d e t e r mi n a ti o n o f t h e c o m m i s s i o n i n c o m e o f t h e p r o v en a c c o m m o d a ti o n e n tr y o p e r a to r. 8 . B ri e f f a c t s o f t h e c a s e a r e t h a t t h e a s s e s s e e is a n i n d i vi d u a l a n d d e r i ve s i n c o m e u n d e r h e a d h o u s e p ro pe r t y, b u s i n e s s a n d p r o f e s s i o n a n d o t h e r s o u rc e s . A s e a rc h a n d s e i z u r e o p e ra t i o n w a s c a rr i e d o u t o n b u s i n e s s a n d re s i d e n t ia l p re m i s e s o f t h e A n a n d J a i n a n d N a r e s h J a i n g r o u p o n 1 7 . 1 2 . 2 0 1 5 a n d s u b s e q u e n tl y , n o t ic e u / s 1 5 3 A d a t e d 2 7 . 1 0 . 2 0 1 7 w a s i s s u e d t o th e a s s e s s e e . 9 . T h e A O h e l d th a t a s s e s s e e ma n a g e s a n d c o n t r o l s s h e l l c o m p a n i e s a n d ro u t e s m o n e y t h r o u g h s u c h c o n c e r n s f or p ro v i d i n g a c c o m m o d a ti o n e n t r i e s . T h e l i s t o f s u c h al le g e d c o n c e rn s i s a s u n d e r : ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 11 1 0 . D u ri n g th e a s s e s s me n t p ro c e e d i n g s , t h e a s s e s s e e s u b m i t t e d t h a t t h e t o t a l tu rn o v e r c a l c u l a t e d b y t h e A O a n d t h e r a t e o f c o m m i s s i o n c h a r ge d b y th e A O w a s n o t c o r re ct . 1 1 . I t w a s a l s o s u b m i t t e d b y t h e a s s e s s e e t h a t th e in c l u s i o n o f b a n k i n g t ra n s a c t i o n s re l a te d o n e c o n c e rn n a me l y M / s A m b a r n u j Fi n a n c e & I n v e s t m e n t s L td . i n t h e w o r k i n g o f t u r n o ve r o f a c c o m m o d a t i o n e n t ri e s i s i n c o r re c t a n d i t i s e vi d e n t f r o m t h e f a c t t h a t a s s e s s m e n t p r o c e e d i n g s of t h e s a i d c o m p a n y h a ve b e e n c o m p l e t e d u n d e r s e c t i o n 1 5 3 A a n d 1 4 3 (3 ) a n d n o a d ve r s e i n f e r e n c e h a d b e e n d ra w n a g a i n s t M / s A m b a r n u j Fi n a n c e & In ve s t m e n t s Lt d . It w a s t h e r e f o re r e q u e s t e d to e x c l u d e th e t r a n s a c t i o n s re l a t e d t o M /s A m b a rn u j Fi n a n c e & I n v e s t me n ts Lt d . f r o m t h e w o r k i n g o f t u r no ve r o f a c c o m m o d a ti o n e n t r i e s a l le g e d t o b e p r o v i d e d b y t h e a s s e s s e e . 1 2 . T h e A O , o n t h e b a s is o f s e i z e d m a t e ri a l a n d p os t s e a rc h in ve s t i g a t i o n s , h e l d t h a t a s s e s s e e i s a n a c co m m o d a t i o n e n t r y p r o vi d e r a n d t h e re f o re c o m p l e t e d t h e a s s e s s m en t o rd e r c o m p u t i n g t h e c o m m i s s i o n in c o m e @ 2 % o n t h e t u rn o v e r o f t h e a m o u n t s r o t a t e d / r o u te d . 1 3 . A g g r i e v e d b y t h e o r d e r o f t h e A O , th e a s s e s s e e f i l e d a p p e a l b e f o re C I T (A ). 1 4 . D u ri n g t h e a p p e l la t e p r o c e e d i n g s b e f o r e t h e l d . C IT (A ), t h e a s s e s s e e f i le d w ri t t e n s u b m i s s i o n s p l e a d i n g t h at , Name of Alleged Concerns 1.Ambarnuj Finance & Investments Pvt. Ltd. 2.Chandra Buildcon Pvt. Ltd 3.Garima Jain 4.Jai Maa Bhawani Overseas Pvt. Ltd. 5.JKS Impex Pvt. 6.Kavita Buildcon 7.KCJ Buildtech 8.Reena Jain 9. Shivangi Garments Pvt. Ltd. 10. Shivaji Garments Pvt. Ltd. 11. Sukumar Buildwell Pvt. Ltd. ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 12 i . T h e w o rk i n g o f t h e t o ta l t u r n o v e r o f t h e c o n c e rn s b y t h e A O is in c o r re c t i i . T h e A O h a s t a k e n a n d a d d e d b o t h c r e d i t a n d d e b it s i d e w h i c h i s i n c o r r e c t a s o n l y c re d i t s i d e t r a n s a c t i o n s o f t h e a l l e g e d s h e l l c o n c e r n s s h o u l d b e t a k e n i n s t e a d o f bo t h d e b i t a n d c re d it . i i i . C ir c u l a r t r a n s a c t io n s a m o n g th e c o n c e r n s h a v e n o t b e e n e l i mi n a te d b y t h e A O w h i l e c o m p u ti n g i n c o m e i v. T u r n o ve r w i t h r e s p e c t t o M /s A m b a r n u j Fi n a n c e I n v e s t m e n t P v t . Lt d . s h o u l d b e e l i mi n a te d a s n o a d ve r s e i n f e re n c e c a n b e d r a w n o n t h e t r a n s a c t i o n s o f th e en t i t i e s . v . A d -h o c r a t e o f 2 % s h o u ld b e r e j e c t e d a n d a ve ra g e r a t e o f c o m m is s i o n a s c o m i n g o u t o f s e i z e d m a t e r i a l s h o ul d b e a p p l i e d . v i. T h e A O h a s i g n o r e d t h e ‘ s h o rt a n d e x c e s s a c c o u nt ’ i n t h e T a l l y D a t a w h i c h re p re s e n t s t h e to t a l a c tu a l c o m m i ss i o n e a rn e d b y t h e a s s e s s e e a n d Sh . N a r e s h K u m a r J a i n a nd a l s o t h e c o r re c t a m o u n t o f a c c o m m o d a ti o n e n t ri e s gi v e n by t h e a s s e s s e e a n d Sh . N a r e s h K u m a r J a i n . v i i . T h e s h o rt a n d e x c e s s a /c c le a r ly d e p i c t s th e co n s o l i d a t e d c o m m i s s i o n i n c o m e e a r n e d o n t h e a c c o m mo d a t i o n e n t r ie s b y t h e a s s e s s e e a n d Sh . N a r e s h K u m a r J a in a n d t h e e x p en d i t u re i n c u r r e d w i t h t h e r e s p e c t t o t h e e a r n i n g o f s a id i nc o m e . A c c o r d i n gl y , a c t u a l c o m mi s s io n c a n b e c o m p u t e d b a s ed o n t h e d a t a a p p e a r i n g i n s h o r t a n d e x c e s s a c c o u n t a n d t h e s a m e m a y a t b e s t b e c h a r g e d i n t h e h a n d s o f t h e a s s e s s e e a s c o m m i s s i o n i n c o m e o n t h e t u rn o v e r. v i i i . Th e w o r k i n g f o r t h e c o n s o l i d a t e d n e t c o m m i s s i o n r a t e i s a s u n d e r : Short and excess A/c Total (in Rs.) Receipts(Credit side) 220,616,047/- Less: Expenses(Debit side) 151,352,004/- Net commission income 6,92,64,043/- i x . I t w a s s u b m i t t e d t h a t t h e t o ta l t u r n o ve r o f a l le g e d a c c o m m o d a ti o n e n t r i e s o f t h e a s s e s s e e a n d S h . N a r e sh K u m a r J a i n . T h e c o m p u t a t i o n i s h e r e u n d e r : ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 13 Particulars Total Turnover Appearing in Tally(Jain Folder) 19,696,128,227 Less: Circular transactions among the shell company 4,842,477,767 Net Turnover as per Tally Data 14,853,650,460 x . t h a t a s p e r t h e a b o v e w o r k i n g t h e n e t ra t e o f c om m i s s i o n e a rn e d b y t h e a p p e l la n t c o m e s t o 6 , 9 2 , 6 4 , 0 4 3 / 1 4 , 8 5 , 3 6 , 5 0 , 4 6 0 ) * 1 0 0 w h i c h a t b e s t c a n b e a p p l i e d o n t h e t u r n o ve r o f a c c o m mo d a t i o n e n t r i e s a ft e r e l i mi n a ti o n o f c i rc u l a r t ra n s a c t i o n s . x i. T h e a s s e s s e e a l s o s u b m i t t e d a d e t a i l e d w o rk i n g o f t h e c o r re c t y e a r w i s e t u r n o v e r o f t h e a c c o m m o d a t i o n e n tr ie s f o r t h e a s s e s s e e w h i c h i s a l s o r e p r o d u c e d b e l o w : Particulars AY 2010-11 AY 2011-12 AY 2012-13 AY 2013-14 AY 2014-15 AY 2015-16 AY 2016-17 Total Working of Turnover Credit entries taken by the AO 143,029,299 3088,746,297 527,895,388 942,231,774 3,507,589,328 543,865,839 826,996,284 9,580,354,209 Less: Circular transactions among the shell company/ eliminated transactions 27,418,331 2,928,640,846 413,194,791 679,514,294 3,261,972,453 283,637,659 109,750,000 7,704,128,374 Credit entries to be consider as turnover 115,610,968 160,105,451 114,700,597 262,717,480 245,616,875 260,228,180 717,246,284 1,876,225,835 1 5 . T h e r e a f t e r, c o n s id e r i n g th e d e ta i l e d s u b m i s s i o n a n d e x p l a n a t i o n f u rn i s h e d b y t h e a s s e s s e e , t h e l d . C IT (A ) r e s tr i c te d t h e r a t e o f c o m m i s s i o n t o 1 . 0 4 % a s a g a i ns t 2 % c o m p u t e d b y t h e A O b y h o l d i n g a s u n d e r i n A Y 2 0 1 0 - 11 . A s i m i l a r f i n d i n g h a s b e e n g i ve n f o r a l l t h e a s s e s s m en t y e a r s . Fo r t h e s a k e o f re a d y re f e r e n c e , t h e re l e va n t p a r t o f t h e o r d e r o f t h e l d . C I T( A ) is r e p r o d u c e d a s u n d e r: “With regard to M/s Ambarnuj Finance & Investments Ltd. 9.7 Further on going through the replies filed before the AO during the course of assessment proceedings under section 153A, it is noticed that the company has submitted the details of loans given, repayment of the same and interest income shown on the same during the year under consideration. The AO has not drawn any adverse inference in this regard in the assessment order. From the above facts, it is evident that in year under consideration, the company was engaged in the business of financing and investment activities which are not doubted by the AO in the assessment order. Further, the returned loss of the company has been accepted and there is no adverse inference/finding of the AO that the company was involved in providing any accommodation entry. In view of these facts, I am of the view that since the business operations of M/s ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 14 Ambarnuj Finance & Investments Pvt. Ltd. are not in doubt in the year under consideration, therefore, it was not justified on the part of the AO to include Rs. 4,64,29,476/- being the aggregate of debit and credit bank transactions of M/s Ambarnuj Finance & Investments Pvt. Ltd. in the working of the commission income, hence, the said figure of Rs. 4,64,29,476/- is reduced from the calculation of commission. With regard to calculation of turnover/quantum of accommodating entries after eliminating the impact of circular transactions and percentage of commission 9.11 From the above instances, I find that the AO has pointed out that the “short & excess account” in the tally data means the commission received by the Jain Brothers. Further from the above quoted instance and other examples quoted by the AO in the assessment order, it is clear that the appellant and his brother use to maintain the data of providing accommodation entries including bank transfers, cash exchanged and commission charged in Jain Folder Tally data. Further the turnover analysis placed in the paper book also depicts that majority of credit entries in the bank statement of shell companies matches with the entries posted in the Jain folder tall data. Accordingly, it becomes relevant to consider the entire short and excess account in the Jain Folder tally data for the purpose of evaluation of actual amount and rate of commission earned by the appellant and his brother on the accommodation entries provided, instead of a few stray instances considered by the AO in the assessment order, when complete details are available in the seized data itself. 9.12 In the tally data the year-wise aggregate of debit and credit side of short and excess account is mentioned. It appears that the credit side represents the commission received and debit side represents the commission paid:- Short and Excess A/c AY 2010- 11 AY 2011- 12 AY 2012- 13 AY 2013- 14 AY 2014- 15 AY 2015- 16 AY 2016-17 Total Receipts(Credit side) 27,377,147 20,165,241 22,557,902 38,865,246 38,186,848 73,503,663 - 220,616,047 Expenses( Debit side) 27,336,593 19,510,546 17,996,407 22,794,455 31,921,772 31,792,231 - 151,352,004 9.13 Further the turnover as per tally data after eliminating circular transactions or the aforesaid six years for which details are available are as under:- Particulars AY 2010- 11 AY 2011- 12 AY 2012- 13 AY 2013- 14 AY 2014- 15 AY 2015- 16 AY 2016-17 Total Turnover Appearing In Tally (Jain Folder) 523,137,544 1,463,935,931 2,694,686,090 3,681,193,690 5,303,052,720 6,030,122,251 - 19,696,128,227 ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 15 Less: Circular transactions among the shell company 83,550,600 453,336,100 913,688,481 799,494,446 985,521,370 1,606,886,770 - 4,842,477,767 Net Turnover as per Tally Data 439,586,944 1,010,599,831 1,780,997,609 2,881,699,244 4,317,531,350 4,423,235,481 - 14,853,650,460 The above table shows that the appellant has received commission of Rs. 22,06,16,047/- and made payments of Rs. 15,13,2,004/- in short and excess a/c over the period of six years for the total turnover of the six years for the total turnover of the six years of Rs. 1485,36,50,460/- The average rate of commission received on total turnover herein above comes to 1.49% (Rs. 22,06,16,047 / 1485,36,50,460*100). Whereas the average rate of commission paid comes to 1.02% (Rs. 15,13,52,004 / 1485,36,50,460*100). Thus, the net commission rate in the tally data seized is search comes to 0.47%. The appellant in this regard, submitted that receipts net off of payment/expenses should be taxed in its hands as commission only. In this regard, the appellant has pointed out that seized record is the best evidence and when income is being considered on the basis of seized record, the expenses as recorded in the seized document also need to be reduced. It is only the net income, which is to be considered. I have examined the seized tally data. On going through the same, the contention of the appellant that expenses side represents the expense incurred by the appellant in arranging accommodation entries is found to be correct. However, in the facts and circumstances of the case, it will not be appropriate to allow deduction of entire expenses. Accordingly, taking a holistic view, I consider that 30% of the gross commission receipts (@1.49%) are the expenditure incurred for earning commission income. Accordingly, I find it appropriate to take rate of 1.04% (1.49% - 0.45%) for charging of commission income on the turnover of accommodation entries in the hands of the appellant.” 9.13 Since, the facts in the case of the appellant are same as that of his brother Sh. Naresh Kumar Jain, therefore, I am inclined to adopt rate of commission at 1.04% as worked in the case of bother of the appellant. The total turnover of the appellant will be as follows:- Particulars AY 2010-11 AY 2011-12 AY 2012-13 AY 2013-14 AY 2014-15 AY 2015-16 AY 2016-17 Total Working of Turnover Credit entries taken by the AO 143,029,299 3088,746,297 527,895,388 942,231,774 3,507,589,328 543,865,839 826,996,284 9,580,354,209 Less: Circular transaction s among the shell company/ eliminated transactions 27,418,331 2,928,640,846 413,194,791 679,514,294 3,261,972,453 283,637,659 109,750,000 7,704,128,374 Credit entries to be consider as turnover 115,610,968 160,105,451 114,700,597 262,717,480 245,616,875 260,228,180 717,246,284 1,876,225,835 ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 16 9.14 In view of the above working the average rate of commission income of 1.04% will be charged in the hands of the appellant on the turnover of Rs. 11,56,10,968/- for the year under consideration. Accordingly, the AO is directed to restrict the addition at Rs. 12,02,355/- .” 1 6 . A g g r i e v e d b y t h e o r d e r o f t h e C I T (A ) , th e a s s e ss e e a n d t h e R e v e n u e f i l e d a n a p p e a l s b e f o r e t h e T ri b u n a l . 1 7 . H e a rd t h e a r g u m e n t s o f b o t h t h e p a r t ie s a n d p e ru s e d t h e m a t e r i a l a v a il a b le o n r e c o rd . 1 8 . W e f i n d t h a t t h e A O h i m s e l f h a s gi v e n a f i n d i n g t h a t c i rc u la r t r a n s a c t io n s s h o u l d b e e l i m i n a t e d w h i l e c omp u t i n g t h e t u r n o ve r o f a c c o m m o d a t io n e n tr i e s . H o w e v e r, w h il e a rr i v i n g a t t h e t u rn o v e r o f a c c o m mo d a t i o n e n t r i e s gi v e n b y t h e a s s e s s e e s u c h e l im i n a t i o n o f c i r c u l a r t ra n s a c t io n s w a s l e f t o u t t o b e ma d e . T h e l d . C IT ( A ) h a s a c c e p t e d t h e w o rk i n g o f t u r n o ve r f u rn i s h e d b y t h e a s s e s s e e a f t e r e l i mi n a ti ng c i r c u l a r t ra n s a c ti o n s o r t r a n s a c t io n s o n w h i c h i n c o m e h a d a lre a d y b e e n o f f e r e d . T h e ld . C IT ( A ) h a s r i g h t l y h e l d t h a t t h e t u r n o ve r w it h r e s p e c t t o M /s A m b a r n u j Fi n a n c e In ve st m e n t P v t . Lt d . s h o u l d b e e l i m in a t e d a s t h e a s s e s s m e n t p ro c e e d i n g s o f M / s A m b a rn u j F i n a n c e I n v e s tm e n t P vt . Lt d . h a ve be e n c o m p l e t e d a n d n o a d ve r s e in f e r e n c e h a s b e e n d r a w n ag a i n s t t h e s a i d c o m p a n y . T h e l d . C I T ( A ) h a s a c c e p t e d t h e gro s s c o m m i s s i o n in c o m e a s a p p e a r i n g i n s h o r t & e x c e s s A /c i n T a l l y D a t a o f J a in Fo ld e r. H o w e v e r , w ha t ha s n o t be e n a c c e pt e d by t h e l d . C I T ( A ) i s t he e x p e n s e s i nc ur r e d i n e a r ni ng s u c h c o m mi s s i o n i nc o me w hi c h w a s a ls o d ul y r e f l e c te d i n t he s a me s h o r t & e x c e s s A / c i n the T a ll y D a t a o f J a i n F o l de r w hi c h is a pa r t o f t he s e i z e d m a t e r ia l. T h e l d . C IT ( A ) i n P a ra 9 . 4 o f P g. 2 0 o f l d . C IT ( A ) ’ s O rd e r f o r A Y 2 0 1 0 - 1 1 h a s s t a t e d th a t , “the contention of the appellant that expenses side represent the expense incurred by the appellant in arranging accommodation entries is found to be correct. However, in the facts and circumstances of the case, it will not be appropriate to allow deduction of entire expenses. Accordingly, taking a holistic view, I consider that 30% of the gross commission receipts (@1.49%) are the expenditure incurred for earning commission income.” 1 9 . T h e r e a f t e r t h e l d . C I T (A ) p r o c e e d e d t o c o mp u t e c o m m i s s i o n i n c o me b y a p p l y i n g a ra t e o f 1 . 0 4 % ( i . e . g ro s s c o m m i s s i o n r e c e i p t s @ 1 . 4 9 % le s s 3 0 % o f g ro s s c o m m i ss i o n r e c e i p t s i . e . 0 . 4 5 % ) o n t h e t u r n o v e r o f f e r e d a n d a cc e p te d b y l d . C IT ( A ). T h e l d . C IT ( A ) h a s n o t b ro u g h t a n y t h i n g o n r e c o rd b u t r e j e c t e d t h e e x p e n s e s i n c u rr e d o n e a r n i ng t h e c o m m i s s i o n i n c o m e a n d a l lo w e d 3 0 % o f c o m m is s i o n i n co m e ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 17 a s e x p e n s e s i n c u r re d f o r e a rn in g s u c h i n c o m e . T h e de c i s i o n o f ld . C IT ( A ) t o re s t r ic t t h e e x p e n s e s i s p u re l y o n a d -h o c b a s is . W h i l e t h e c o m m i s s i o n i n c o m e a p p e a ri n g i n Sh or t & e x c e s s A / c in Ta l l y D a t a o f J a i n Fo l d e r i s a c c e p te d, r e j ec t i o n o f e x p e n s e s a p p e a ri n g i n th e s a m e s h o rt & e x c e s s A /c i n T a l l y D a t a o f J a i n Fo l d e r i s n o t t e n a b l e a n d w i th o u t a n y l o g i c a l c o n c l u s i o n . A d o c u m e n t h a s t o b e r e a d i n i t s w h o l e p ro s p e c t i ve b u t n o t in s u c h a w a y t h a t t h e d a t a s e ize d i s i n t e r p r e t e d to re s u l t in t w o d i a me t r i c a l l y o p p o s i t e d e r i va t i o n s . A s u mm a r y o f t u r n o ve r o f a c c o m m o d a t i o n e n t ri e s a n d c o n s e q u e n t l y a d d i t i o n o f c o m m i s s i o n i n c o m e c o m pu t e d b y A O a n d t h e t u r n o ve r a n d c o mm i s s i o n i n c o m e c o n f irm e d b y l d . C IT ( A ) v i s -à - v i s c o m m i s s i o n i n c o m e a s p e r t h e as s e s s e e i s t a b u l a t e d b e l o w : Assessment Turnover Turnover as Average Average Yearly Average Year calculated as per assessee & Yearly Commission Yearly per AO accepted by Commission calculated by the Commission CIT(A) charged by the AO @2% on the total turnover on ad hoc basis CIT(A) @1.04% on the total turnover(by arbitrarily restricting expenses on earning commission to 30% of gross commission income) which should have been considered @0.47% on the total turnover AY 2010-11 27,66,87,335 115,610,968 55,33,746 12,02,355 5,43,372 AY 2011-12 618,05,53,386 160,105,451 12,36,11,068 16,65,096 7,52,496 AY 2012-13 105,04,22,587 114,700,597 2,10,08,452 11,92,886 5,39,093 AY 2013-14 187,86,43,617 262,717,480 3,75,72,872 27,32,262 12,34,772 AY 2014-15 696,49,99,924 245,616,875 13,92,99,999 25,54,416 11,54,399 AY 2015-16 109,26,08,571 260,228,180 2,18,52,171 27,06,373 12,23,072 AY 2016-17 180,12,05,658 717,246,284 3,60,24,113 74,59,361 33,71,058 Total 1924,51,21,078 187,62,25,835 38,49,02,421 1,95,12,749 88,18,262 2 0 . R e l i a n c e i s b e i n g p l a c e d o n t h e j u d g m e n t o f H o n’ b l e Su p r e me C o u r t in th e c a s e o f R e l i a n c e In d u s t r i e s Lim i t e d V s . SE B I, 2 0 2 2 ( 8 ) T M I 4 2 3 - d a t e d A u g u s t 5 , 2 0 2 2 w h e rei n i t w a s h e ld t h a t , “57. Before we part with the present appeal, another disconcerting aspect of this case that comes to the fore is SEBI’s attempt to cherrypick the documents it proposes to disclose. There is a dispute about the fact that certain excerpts of the opinion of Justice (Retd.) B. N. Srikrishna, were disclosed to the appellant herein. It is the allegation of the appellant that while the parts which were disclosed, vaguely point to the culpability of the appellant, SEBI is refusing to divulge the information which exonerate it. Such cherrypicking by SEBI only derogates the commitment to a fair trial. In Nea Karteria Maritime Co Ltd v. Atlantic and Great Lakes Steamship Corporation, [1981] Com LR 138 at 139, Mustill J. held as under: ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 18 “I believe that the principle underlying the rule of practice exemplified in Burnell v British Transport Commission [1956] 1 QB 187 is that where a party is deploying in court material which would otherwise be privileged, the opposite party and the court must have an opportunity of satisfying themselves that what the party has chosen to release from privilege represents the whole of the material relevant to the issue in question. To allow an individual item to be plucked out of context would be to risk injustice through its real weight or meaning being misunderstood.” The aforesaid principle is often referred to as the ‘Cherrypicking’ principle. 58. In the case at hand, SEBI could not have claimed privilege over certain parts of the documents and at the same time, agreeing to disclose some part. Such selective disclosure cannot be countenanced in law as it clearly amounts to cherry picking.” 2 1 . T h e r e f o re , a s p e r t h e e x p l a n a t i o n a n d s u b m i s s i on s o f t h e a s s e s s e e , w h o l e o f t h e e x p e n s e s i n c u r r e d i n e a rn i n g c o m m i s s i o n i n c o me s ha l l be a l l o w e d a n d a c c o r di ng l y t h e ne t r a te o f c o mmi s s i o n e a r ne d b y t h e a s s e s s e e i . e. 0 . 4 7 % i s t he b e s t w h i c h c a n be a p pl ie d o n t he t u r n o v e r o f t h e a c c o m m o d a ti o n e n t r i e s a f te r e l i m i n a t i o n o f c i r c u l a r t ra n s a c ti o n s . T h u s t h e m a x i m u m a d d i t i o n w h i c h c a n be m a d e i n t h e h a n d s o f t h e a s s e s s e e o n a c c o u n t o f c o mm i s s io n e a rn e d o n t u r n o ve r o f t h e a c c o m m o d a t io n e n tr i e s w o r k e d o u t a s u n d e r : Assessment Year Turnover (after elimination of circular transactions) Commission rate Commission Income AY 2010-11 115,610,968 0.47% 5,43,372/- AY 2011-12 160,105,451 0.47% 7,52,496/- AY 2012-13 114,700,597 0.47% 5,39,093/- AY 2013-14 262,717,480 0.47% 12,34,772/- AY 2014-15 245,616,875 0.47% 11,54,399/- AY 2015-16 260,228,180 0.47% 12,23,072/- AY 2016-17 717,246,284 0.47% 33,71,058/- 2 2 . T h e A O i s t h e r e f o re d ir e c te d to gi v e e f f e c t t o t h i s o rd e r a c c o r d i n g l y. B e f o r e p a r ti n g w e w o u l d l i k e t o c l a ri fy t h a t t h e d e t e r mi n a ti o n o f e x p e n s e s a n d t h e c o m m i s s i o n e a r n e d i s b a s e d o n t h e i n c r i m in a t in g m a te r i a l s p e c i f i c a l ly f ou n d a n d s e i z e d d u ri n g t h e c o u r s e s o f s e a rc h a n d h e n c e t h e pe r c e n t a ge o f c o m m i s s i o n e a r n e d c a n n o t b e c o n s i d e r e d t o b e t h e s a m e in o th e r s i m i l a r c a s e s . ” ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 19 12. Since facts are identical and same search was conducted on both the brothers, we follow the principle of stare decisis and follow the aforesaid order. Hence, the rate of commission in the present cases is determined at 0.47%. AO is accordingly directed to follow the direction in the aforesaid ITAT order. 13. Our above order applies mutatis mutandis to all the appeals filed by the assessee and Revenue in relation to rate of commission. ITA Nos.1749 to 1754/Del/2019 (AYs 2010-11 to 2015-16) 14. Apropos protective addition : Since facts are identical we are referring to the facts and figures from AY 2014-15. The ld. CIT (A) has elaborately discussed the facts and decided as under :- “The assessee has challenged the protective addition of Rs.72,15,210/- made by the AO on account of unexplained cash credit in the form of unsecured loan. The AO in the assessment order has added an amount of Rs.72,15,210/- on account of unsecured loan received from following parties :- S.No. Name of party Amount received 1 Mahadev Investments 1,15,210 2 Pragaya Multitraders Pvt. Ltd. 3,00,000 3 Gomati Consultants Pvt. Ltd. 18,00,000 4 Naresh Kumar Jain HUF 13,00,000 5 Groupone Informative Services P. Ltd. 7,00,000 6 Maha Laxmi Trading Co. 2,00,000 7 Next Generation Exim Pvt. Ltd. 5,00,000 8 Next Generation Exim Pvt. Ltd. 20,00,000 9 Pragaya Multitraders Pvt. Ltd. 3,00,000 Total : 72,15,210 ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 20 10.1 The AO has added the above amount in the hands of the appellant on the ground that the he has failed to produce directors of the shell companies to verify the identity of the company, genuineness of the transactions and creditworthiness of the company. In this regard, the AD has also alleged that the directors of the above companies are dummy directors and the companies are shell companies which are being managed and controlled by Sh. Anand Kumar Jain and Sh. Naresh Kumar Jain. The AO has acknowledged the filing of documentary evidences by the appellant in the form of confirmation, bank statement and acknowledgement of ITR with respect to the above companies. However, not satisfied with the explanation and the documentary evidences submitted by the appellant, he has added the amount of Rs.72,15,210/- as unexplained cash credit on protective basis in the hands of the appellant. The AO has also mentioned that the addition of unaccounted commission has already been made in the hands of the appellant and his brother on substantive basis. The appellant in his written submission has tried to substantiate the genuineness, creditworthiness and identity of the lenders making reference to the documentary evidences filed before the AD. The appellant alternatively also submitted that no protective addition can be made in his hands if the substantive addition of undisclosed commission income is sustained. In this regard, it is noticed that out of total amount of Rs.72,15,210/-, the amount of Rs.13,00,000/- was received from the appellant own HUF, for which there is no specific allegation of the AO in the assessment order doubting the source of funds its bank statement neither it has been held as a shell concern, hence no adverse inference can be drawn in this regard. Further the remaining amount of Rs.59,15,210/- was received by the appellant from Mahadev Investments, Next Generation Exim Pvt. Ltd., Pragaya Multitraders Pvt. Ltd., Gomati Consultants Pvt. Ltd., Group one Informative Pvt. Ltd., Maha Laxmi Trading Co. and Next Generation Exim Pvt. Ltd. These companies from whom funds were received by the appellant have already been treated as shell companies operated and managed by the appellant and his brother. From the operation and management of these shell companies the appellant and his brother had earned undisclosed commission in lieu of providing accommodation entries to the various beneficiaries which is the ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 21 substantive addition made by the AO. With regard to the said earning of undisclosed commission substantive addition to the extent of Rs.4,90,35,779/- has already been confirmed in the hands of the appellant. The amount of Rs.72,15,210/- received by the appellant can at best be treated as obtained out of his undisclosed commission income which has already been brought to tax. Therefore, being the protective addition made by the AO of Rs.72,15,210/- is double addition in the hands of the appellant, the same is directed to be deleted.” 15. Against the above order, the Revenue is in appeal before us. 16. We have heard the parties. We note that the Ld. CIT(A) has held that the impugned amount can at best be treated as obtained out of assessee’s undisclosed commission income which has already been brought to tax. We note that on identical issue, the Tribunal in ITA No.2889/Del/2019 in the case of Sh. Anand Kumar Jain, observed that such receipt form part of accommodation entries and that the AO may verify the same. Following the aforesaid precedent, we direct the AO to verify the same as stated above. 17. Our above adjudication applies mutatis mutandis to all the additions on protective basis in all the appeals here. ITA No.1752/Del/2013 (AY 2013-14) 18. Apropos DVO Report : The AO in the assessment order has added Rs. 24,60,451/- on account of difference in the value of property purchased by him and his wife during the year under consideration. The AO in the assessment order has mentioned that the immovable property ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 22 purchased by the appellant was referred for valuation to the DVO. The DVO has submitted his valuation report dated 21/08/2018 wherein it has been intimated that due to non cooperation of the appellant, no proper inspection / visit could be made and accordingly he had to close the case. The AO has mentioned to have conducted spot enquiries through his inspector to ascertain the market value of the property. The Inspector in his report has stated that he conducted local enquiries from the property dealers of the area who have confirmed that the value of the property is approximately at Rs. 1.25 crores. Based on the said report of the inspector, the AO has added 50% of the difference in the value of the property amounting to Rs.24,60,451/- (50% of difference of Rs. 4920900/-). 19. The ld. CIT(A) adjudicated the issue as under:- “11.2. On going through the observations of the AO in the assessment order, the report of the DO, the report of the inspector and written submissions of the appellant, it is noticed that the appellant has purchased the property in question during the year under consideration along with his wife as co-owner for a consideration of Rs. 75,79,100/-. The appellant in support of his contention has submitted a copy of sale deed which is placed at PB Pg. 56-67. On perusal of the same, it is noticed that the circle rate / the stamp valuation rate of the property is Rs. 71,42,400/- and the appellant has sold the property for a consideration of Rs.71,50,000/- + Stamp duty of Rs. 3,57,500/-. The report of the DVO is placed at PB Pg.298. On perusal of the same, it is noticed that the DVO has only mentioned that the appellant has not cooperated with him and accordingly he could not make the inspection / visit of the property for the valuation. He has not ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 23 mentioned anything on the merits of the case. From the report of the DVO, it is also noticed that he has nowhere mentioned anything regarding the underreporting of the sale consideration showed by the appellant. As far as the issue of non cooperation of the appellant is concerned, the appellant has duly discharged his onus by submitting reply before the DVO along with the copy of sale deed and intimating the DO regarding the sale of the property by him. Accordingly, no adverse inference can be drawn from the report of the DVO. The main evidence based on which addition has been made in the hands of the appellant is the report of the inspector. The copy of said report is placed at PB.Pg. no.297. On perusal of the said report, it is noticed that the inspector has mentioned to have made a visit to the property on 30/08/2018, on which he noticed that the property is a newly constructed multistory building constructed on approximate land of 110 - 150 yards. The inspector has further mentioned to have made enquiries from property dealers with respect to the value of the property who have informed him that the value of the property is around 1.25 crores. On careful perusal of the report of the inspector, it is noticed that the report is not supported by any evidence collected by the inspector on the spot verification. It is also noticed that the inspector has mentioned to have made enquiry from the local property dealer, however, he has not mentioned the name / whereabouts of the said property dealer. Also, it has not been mentioned that on what basis the property dealer has intimated him the rate of the property at Rs.1.25 crores. Further there is no reference of any comparable sale deed of any other property in the same locality or any other documentary evidence which could form basis to ascertain higher value of property in the hands of the appellant. Accordingly, it can be concluded that the report of the inspector for the purpose of evaluation of value of the property cannot be relied upon since the same is not corroborated with any documentary evidence. Further, it is also matter of the fact that the sale consideration paid by the appellant is at the circle rate / stamp valuation rate prescribed by the stamp valuation authority. The said rate has not been doubted by the A in the assessment order. Further, there is no evidence on record which could prove something over and above emanated from the coffer of the appellant which has been utilized for the purchase of the property. It is ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 24 also relevant to notice here that the AO has also not pointed out/brought any incriminating material found during the course of search which could lead to the conclusion that the appellant has paid consideration for the purchase of property over and above what has been declared in the purchase deed. Accordingly, simply based on the suspicion no addition can be made in the hands of the appellant estimating the value of the property. Therefore, the AO is directed to delete the addition.” 20. Against the above order, the Revenue is in appeal before us. 21. Heard the parties. We note that the on identical issue, the Tribunal in ITA No.2889, 2890 and 2891/Del/2019, vide order dated 28.04.2023 has adjudicated the issue as under:- “27. We have gone through order of the ld. CIT(A) in detail. The ld. CIT(A) concurrently considered the provisions of Section 56(2)(viib) and Section 50C, report of the DVO and the stamp duty valuation (circle rates). The ld. CIT(A) held that the value as per the stamp duty valuation authority shall be taken as full value of the consideration and since the payment made by the assessee is as per the stamp value authorities determination no addition is called for. With regard to the addition made on account of cost of construction, the ld. CIT(A) held that there was no difference between the value in the cost of construction declared by the assessee and the value as considered by the AO, can be attributed owing to the variance being less than 10% of the accepted norms of variation. Having gone through the facts, we find no reason to interfere with the decision of the ld. CIT(A) who accepted the value of the land as per the circle rate and value of the construction within the acceptable range of variation. 22. On a perusal of the ld. CIT(A)’s order in the light of aforesaid ITAT order, we find in the present case also, the Ld. CIT(A) has given a finding transaction was not below the circle rate. We note that the ld. ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 25 CIT(A) has passed a well reasoned order, which does not need interference. 23. In the result, all the appeals filed by the assessee and the Revenue are partly allowed. Order pronounced in the open court on this 24 th day of May, 2023. Sd/- sd/- (ANUBHAV SHARMA) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated the 24 th day of May, 2023 TS Copy forwarded to: 1.Appellant 2.Respondent 3.CIT 4.CIT (A)-36, New Delhi. 5.CIT(ITAT), New Delhi. AR, ITAT NEW DELHI. ITA Nos.1325 to 1331/Del./2019 ITA Nos.1749 to 1754/Del./2019 26 Date of Dictation : 18.05.2023 Date on which the typed draft is placed before the Dictating Member: 19.05.2023 Date on which the approved draft come to Sr.PS/PS : 19.05.2023 Date on which fair order sent to Member for signature : 19.05.2023 Date on which the fair order comes back after pronouncement to the Sr.PS/PS : 24.05.2023 Date on which order is uploaded: 24.05.2023 Date on which the file goes to the Bench Clerk: 24.05.2023 Date on which the file goes to the Head Clerk....................................... The date on which the file goes to the AR for signature on the order............ Date of Despatch of the Order......................................................