Shri Piyushkumar Balkrushna Acharya, Mehsana V. The ACIT.,Cent.Circle-1(1), Ahmedabad

ITA 1947/AHD/2013

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 9014 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 7 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 14-03-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 16-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: K C THAKOR
• Keywords: Bogus purchase
• Section: 133A; 131

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ITA.NO.2381 & 2382/AHD/2012 / ASSTT.YEAR : 2008-2009 & 2009-2010 AND ITA.NO.1947/AHD/2013 / ASSTT.YEAR : 2007-2008 PIYUSH KUMAR B. ACHARYA PROP. OF UTSAV CORPORATION H-2, MARKET YARD MEHSANA 384 001. VS ACIT, CENT.CIR.1(1) MEHSANA. ITA.NO.2094 & 2095/AHD/2012 / ASSTT.YEAR : 2008-2009 & 2009-2010 ACIT, CENT.CIR.1(1) MEHSANA. VS PIYUSH KUMAR B. ACHARYA PROP. OF UTSAV CORPORATION H-2, MARKET YARD MEHSANA 384 001. / (APPELLANT) / (RESPONDENT) REVENUE BY : SHRI K. MADHUSUDAN, SR.DR ASSESSEE BY : SHRI K.C. THAKOR, AR / DATE OF HEARING : 14/03/2017 / DATE OF PRONOUNCEMENT: 15/03/2017 !'/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER ASSESSEE AND THE REVENUE ARE IN CROSS-APPEALS IN AS STT.YEAR 2008-09 AND 2009-10 AGAINST COMMON ORDERS OF THE LD.CIT(A)- I, AHMEDABAD DATED 19.7.2012. IN THE ASSTT.YEAR 2007-08 ASSESSEE ALON E IS CHALLENGING THE ORDER ITA NO.2381/AHD/2012 AND 4 OTHERS SHRI PIYUSH KUMAR B. ACHARYA VS. ACIT, MEHSANA 2 OF THE LD.CIT(A) DATED 17.5.2013. SINCE COMMON ISS UE IS INVOLVED IN ALL THESE APPEALS, THEREFORE, WE HEARD THEM TOGETHER AN D DEEM IT APPROPRIATE TO DISPOSE OF THEM BY THIS COMMON ORDER. 2. THE LD.REPRESENTATIVES HAVE ARGUED APPEAL FOR TH E ASSTT.YEAR 2008-09, THEREFORE, FOR FACILITY OF REFERENCE, WE TAKE UP TH E FACTS FROM THE ASSTT.YEAR 2008-09. 3. BEFORE ADVERTING TO SPECIFIC GRIEVANCE OF THE AS SESSEE OR THE REVENUE IN THESE APPEALS, WE DEEM IT APPROPRIATE TO TAKE NOTE OF BRIEF BACKGROUND OF ALL THE FACTS GIVING RISE TO THE LITIGATION IN THESE AP PEALS. 4. ASSESSEE IS AN INDIVIDUAL. HE WAS ENGAGED IN TH E BUSINESS OF SUPPLYING FOODGRAINS TO DIFFERENT PERSONS ON COMMISSION BASIS AND WAS NOT PURCHASING OR SELLING ANY GOODS AT HIS OWN. THE ASSESSEE WAS ALSO DOING BUSINESS OF CANVASSING AGENT. SURVEY UNDER SECTION 133A OF THE INCOME TAX ACT WAS CARRIED OUT AT THE BUSINESS PREMISES OF THE ASSESSE E ON 20.6.2008. IT IS PERTINENT TO OBSERVE THAT DEPARTMENT HAS CARRIED OU T SURVEY ON A NUMBER OF CONCERNS ENGAGED IN THE BUSINESS OF TRADING IN EDIB LE OIL IN PATAN DISTRICT. DURING THE COURSE OF SURVEY, IT REVEALED THAT ONE M /S.VISHAL TRADERS, VIRPUR WAS A BOGUS CONCERN AND ISSUING BILLS TO VARIOUS CO NCERNS ENGAGED IN TRADING OR MANUFACTURING OF COTTON SEEDS, FOODGRAINS, OIL S EEDS ETC. THE ASSESSEE HAS ALSO WORKED AS A CANVASSING AGENT TO GUJARAT AMBUJA EXPORTS LTD., AND M/S.VISHAL TRADERS. ACCORDING TO THE ASSESSEE, HE USED TO WORK AS A COMMISSION AGENT. HIS JOB WAS TO RECEIVE CHEQUE IN THE NAME OF VISHAL TRADERS FROM M/S.GUJARAT AMBUJA EXPORTS. THOSE CHE QUES WERE DEPOSITED IN CURRENT ACCOUNT NO.06577 WITH MEHSANA NAGRIK SAHAKA RI BANK LTD. VISHAL TRADERS USED TO GIVE SELF-CHEQUE TO THE ASSESSEE. HE WITHDREW CASH FROM THE ITA NO.2381/AHD/2012 AND 4 OTHERS SHRI PIYUSH KUMAR B. ACHARYA VS. ACIT, MEHSANA 3 BANK AND HANDED OVER THE CASH TO SHRI MADANLAL L. S HAH (CHADAK). THERE IS NO DISPUTE WITH REGARD TO THIS MODUS OPERANDI OR WITH REGARD TO EARNING OF COMMISSION INCOME IN THIS CLANDESTINE MANNER. THE LD.AO AFTER AN ANALYSIS OF RECORD CALLED OUT DETAILS AS NOTICED AT PAGE NO. 5 OF THE ASSESSMENT ORDER FOR ASSTT.YEAR 2008-09. HE HAS TABULATED TURNOVER OF V ISHAL TRADERS AND HOW SUCH TURNOVER HAS BEEN WORKED OUT FROM THE DIFFEREN T BANK ACCOUNT IN DIFFERENT YEARS. IN ORDER TO UNDERSTAND THE CONTRO VERSY IN MORE SCIENTIFIC WAY, IT IS INCUMBENT UPON US TO TAKE NOTE OF THIS TABLE. IT READS AS UNDER: BANK AND BANK A/C.NO. DEPOSITS DURING F.Y. 2006-07 2007-08 2008-09 TOTAL THE KALUPUR COMMERCIAL CO.OP. BANK LTD. A/C. NO.0120114293 2,27,48,110 7,35,31,655 0 9,62,79,765 DENA GUJARAT GRAMIN BANK A/C. NO.639 0 1,64,42,500 0 1,64,42,500 THE MEHSANA NAGRIK SAHAKARI BANK LTD. A/C. NO.06577 0 2,04,23,897 37,48,108 2,41,72,005 THE HARIJ NAGRIK SAHAKARI BANK LTD. A/C. NO.4775 1,79,37,127 22,85,91,022 3,32,33,476 27,97,61,625 TOTAL 4,06,85,237 33,89,89,074 3,69,81,584 41,66,55,895 THE DEPOSITS IN THE BANK ACCOUNT REPRESENT THE SALE S (BOGUS) CLAIMED TO HAVE BEEN MADE TO VARIOUS PARTIES BY M/S. VISHAL TRADERS . IN THE STATEMENTS RECORDED U/S 133A & 131 OF THE INCOME TAX ACT, 1961 AND VIDE SUBMISSION DATED 28.10.2010, THE ASSESSEE HIMSELF ADMITTED THI T HE WAS DOING THE BUSINESS AS COMMISSION AGENT FOR VISHAL TRADERS. DURING THE COU RSE OF ASSESSMENT PROCEEDINGS, ASSESSEE WAS GIVEN OPPORTUNITY TO FURN ISH THE DETAILS OF COMMISSION INCOME RECEIVED FROM VISHAL TRADERS. HOW EVER, DESPITE NUMBER OF OPPORTUNITIES BEING GIVEN, THE ASSESSEE HAS NOT GIV EN THE DETAILS OF COMMISSION RECEIVED FROM VISHAL TRADES. THEREFORE, COMMISSION INCOME HAS TO BE CALCULATED ON THE BASIS OF TOTAL DEPOSITS MADE IN T HESE BANK ACCOUNTS. TOTAL DEPOSITS MADE IN THESE BANK ACCOUNTS IN F.Y.2007-08 (A.Y.08-09) IS RS.33,89,89,074/-. THUS, M/S. VISHAL TRADERS HAS IS SUED BOGUS SALES BILLS OF ITA NO.2381/AHD/2012 AND 4 OTHERS SHRI PIYUSH KUMAR B. ACHARYA VS. ACIT, MEHSANA 4 RS.33,89,89,074/- DURING A.Y.2008-09. ACCORDINGLY C OMMISSION INCOME RECEIVED BY SHRI PIYUSHKUMAR BALKRUSHNA ACHARYA FOR FACILITATING ISSUE OF BOGUS BILLS BY M/S. VISHAL TRADERS IS CALCULATED @2 % OF THE TOTAL BOGUS BILLS WHICH COMES TO RS 67,79,780/-. THE SAME IS HEREBY A DDED TO THE TOTAL INCOME OF THE ASSESSEE. PENALTY PROCEEDINGS U/S.271(1)(C) IS INITIATED FOR FURNISHING INACCURATE PARTICULARS OF INCOME. 5. ACCORDING TO THE AO, THESE ARE THE TRANSACTIONS CARRIED OUT IN DIFFERENT BANKS AND COMMISSION INCOME DESERVES TO BE ASSESSED AT THE RATE OF 2% IN THE CASE OF THE ASSESSEE. ON THE OTHER HAND, THE CASE OF THE ASSESSEE IS THAT HE HAS DISCLOSED CARRYING OUT OF ACTIVITY WITH REGARD TO A CCOUNT NO.6577 WITH MEHSANA NAGRIK SAHAKARI BANK LTD. HE HAS NOT HANDL ED ANY OTHER BANK ACCOUNT AND THE LD.AO HAS MADE ADDITION ON ESTIMATE BASIS. THE LD.AO HAS CONSIDERED THE INCOME AT 2% OF THE ALLEGED TURN OVER IN DIFFERENT ASSESSMENT YEARS. ACCORDINGLY, ADDITION OF RS.67,7 9,780/- HAS BEEN MADE IN THE ASSTT.YEAR 2008-09. THIS IS 2% OF RS.33,89,89, 074/- THE TOTAL TURNOVER COMPUTED FOR THIS PURPOSE AS DISCERNIBLE IN THE OBS ERVATION OF THE AO REPRODUCED ABOVE. APPEAL TO THE LD.CIT(A) DID NOT BRING ANY RELIEF TO THE ASSESSEE. AS FAR AS WORKING OF THE TURNOVER IS CONCERNED, THE LD.CIT(A) HAS CONFIRMED THE FINDING OF AO BUT REDUCED THE ESTIMAT ION OF INCOME FROM 2% TO 1% IN ASSTT.YEAR 2008-09 AND 2009-10, WHEREAS IN ASSTT.YEAR 2007-08, THE LD.CIT(A) HAS CONFIRMED THE ESTIMATION OF COMMISSIO N INCOME AT THE RATE OF 2%. THE ASSESSEE IS CHALLENGING COMPUTATION OF TUR NOVER FROM DIFFERENT BANKS (TABULATED ABOVE) AND ESTIMATION OF SUCH INCO ME AT 2% IN ASSTT.YEAR 2007-08 AND 1% IN ASSTT.YEAR 2008-09 AND 2009-10. ON THE OTHER HAND, DEPARTMENT IN ITS TWO APPEALS CHALLENGED REDUCTION OF RATE FROM 2% TO 1% FOR CALCULATING COMMISSION INCOME. 6. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVES, W E HAVE GONE THROUGH THE RECORD CAREFULLY. THERE IS NO DISPUTE WITH REGARD T O THE FACT THAT THE ASSESSEE ITA NO.2381/AHD/2012 AND 4 OTHERS SHRI PIYUSH KUMAR B. ACHARYA VS. ACIT, MEHSANA 5 HAS TAKEN PART IN TRANSACTIONS CARRIED OUT BY VISHA L TRADERS IN ISSUING BOGUS BILLS. THE ASSESSEE DID NOT DISPUTE. THE LIMITED DISPUTE BETWEEN THE REVENUE AND THE ASSESSEE IS THAT THE AO HAS ASSUMED THE ASS ESSEE OF CARRYING OUT OF THE TRANSACTIONS OF VISHAL TRADERS IN DIFFERENT BAN KS LOCATED IN DIFFERENT CITIES, WHEREAS STAND OF THE ASSESSEE IS THAT HE IS BASED I N MEHSANA. HE HAS TAKEN CARE OF TRANSACTIONS REFLECTED IN THE MEHSANA NAGRI K SAHAKARI BANK LTD. TRANSACTIONS IN REST OF THE BANKS WERE NOT CARRIED OUT BY HIM AND HE HAS NOT PLAYED ANY ROLE WITH REGARD TO THE TRANSACTIONS REF LECTED IN KALUPUR COMMERCIAL CO-OP. BANK LTD., HARIJ NAGNRIK SAHAKARI BANK LTD., DENA GUJARAT GRAMIN BANK LTD. THIS PLEA WAS RAISED BEFO RE LD.CIT(A) ALSO, AND THE LD.CIT(A) HAS ASKED FOR A SPECIFIC REPLY FROM THE L D.AO VIDE SHOW CAUSE NOTICE DATED 8.6.2012. COPY OF THIS LETTER HAS BEE N EXTRACTED BY THE LD.CIT(A) ON PAGE NO.8 FOR THE ASSTT.YEAR W008-09 AND 2009-10 . THE AO HAS ATTENDED THE OFFICE OF THE LD.CIT(A) AND SUBMITTED HIS COMME NTS. THE LD.CIT(A) THEREAFTER MADE THE FOLLOWING DISCUSSIONS: 9. IN RESPONSE THE A.O. ATTENDED THIS OFFICE ON 18 .07.2012 AND ARGUED THAT NO FRESH EVIDENCE HAD BEEN FILED BY THE APPELL ANT. THAT HE IS NOT STATING ANYTHING NEW WHICH HE HAS NOT STATED DURING ASSESSMENT PROCEEDINGS. THE AO ARGUED THAT THE APPELLANT HAS A DMITTED HIMSELF THAT HE WORKED AS COMMISSION AGENT OF VISHAL TRADER S THEREFORE, THE ADDITION SHOULD BE UPHELD. 10. AFTER GOING THROUGH RIVAL SUBMISSIONS FOLLOWING POINTS EMERGE: (1) THE APPELLANT WORKS ON COMMISSION. IN THE RETUR NS, HE HAS SHOWN COMMISSION RECEIVED FROM M/S.GUJARAT AMBUJA EXPORTS LTD ON THE BASIS OF TDS CERTIFICATES ISSUED BY THIS CONCERN. R ETURN OF AY 2008-09 HAVE BEEN FILED AT JUST RS. 1,07,637 AND OF AY 2009 -10 OF RS. 1,55,300. IN THE PROFIT AND LOSS ACCOUNT OF AY 2008-09 DALALI INCOME HAS BEEN SHOWN AT RS.2,63,447 AND IN AY 2009-10 OF RS.3,06,2 04 AND AFTER CLAIMING EXPENSES LIKE OFFICE EXPENSES, SALARY, TEL EPHONE ETC. NET PROFIT AT RS.1,12,533 IN AY 2008-09 AND AT RS. 1,61,590 IN AY 2009-10. THE ITA NO.2381/AHD/2012 AND 4 OTHERS SHRI PIYUSH KUMAR B. ACHARYA VS. ACIT, MEHSANA 6 PROFIT AND LOSS ACCOUNTS OF THE TWO YEARS FILED WIT H THE RETURNS ARE ENCLOSED AS ANNEXURE-3 OF THIS ORDER. (2) THE APPELLANT HAS ADMITTED BOTH DURING SURVEY A ND DURING ASSESSMENT/APPELLATE PROCEEDINGS THAT HE HAS WORKED FOR M/S.VISHAL TRADERS. (3) THE APPELLANT HAS INFORMED THE MODUS O PERANDI OF DEPOSITING CHEQUES RECEIVED BY VISHAL TRADERS IN ITS BANK ACCO UNTS AND THEN WITHDRAWING CASH THROUGH SELF DRAWN CHEQUES OF VISH AL TRADERS, AND THEN HANDING OVER THE CASH TO SHRI MADANLAL SHAH. (4) SEARCH OPERATION IN THE EDIBLE OIL GROUP CASES (LIKE GUJARAT AMBUJA EXPORTS, PANKAJ COTTON INDUSTRIES, TIRUPATI COTTON, DEEP COTTON, OM SHRI NAGRAJ GINNING AND MANY OTHERS ) CO NDUCTED BY THE DEPARTMENT ON 01.09.2008 AND SUBSEQUENT DATES REVEA LED THAT THESE CONCERNS WERE OBTAINING BOGUS BILLS FROM ONE M/S.VI SHAL TRADERS (PROPRIETOR SHRI DHARMENDRA PANDYA). CHEQUES ISSUED TO VISHAL TRADERS WERE DEPOSITED IN ITS BANK ACCOUNTS, BUT IM MEDIATELY CASH WITHDRAWALS OF EQUIVALENT AMOUNTS WERE MADE, WHICH WAS AN UNUSUAL PATTERN NOTICED. THAT THE CASH WITHDRAWN WAS ROUTED BACK TO THE CONCERNS BY VISHAL TRADERS WHICH ISSUED CHEQUES FOR THE SO CALLED PURCHASES OF COTTON SEEDS, OIL SEEDS, FOOD GRAINS E TC. THE APPELLANT HAS CONFIRMED WORKING FOR VISHAL TRAD ERS AND IS AN INTEGRAL PART .OF THIS-BOGUS BILL ISSUING BUSINESS WITH SHRI DHARMENDRA PANDYA (THE PROPRIETOR OF VISHAL TRADERS) AND SHRI MADANLAL SHAH, (TO WHOM THE APPELLANT RETURNED BACK THE CASH WITHDRAWN FROM VISHAL TRADERS BANK ACCOUNTS). THIS EXERCISE THE APPELLANT WOULD NOT HAVE DONE WITHOUT BEING RECIPIENT OF SOME COMMISSION FRO M VISHAL TRADERS. (5) DESPITE OPPORTUNITIES, THE APPELLANT DID NOT SU BMIT ENGLISH TRANSLATION OF HIS STATEMENTS NEITHER ANY OTHER EVI DENCE IN SUPPORT OF THE CONTENTION THAT NO ADDITION SHOULD BE MADE IN H IS CASE AND THAT HIS RETURN DECLARING COMMISSION RECEIVED FROM GUJARAT A MBUJA EXPORTS LTD. SHOULD BE ACCEPTED. THIS WAS EMPHASIZED TO THE APPELLANT DURING THE COURSE OF HEARING IN THIS OFFICE ON 16.4.2012 A ND ALSO THROUGH THIS OFFICE LETTER DATED 8.6.2012 WHICH HAS BEEN REPRODU CED ABOVE. (6) GUJARAT AMBUJA EXPORTS FILED RETURN OF AY 2008- 09 IN RESPONSE TO NOTICE ISSUED U/S.153A WITH ACIT CENTRAL CIRCLE ON 30.9.2009 ITA NO.2381/AHD/2012 AND 4 OTHERS SHRI PIYUSH KUMAR B. ACHARYA VS. ACIT, MEHSANA 7 DECLARING INCOME OF RS.114,56,29,143. DURING ASSESS MENT PROCEEDINGS IT CONFIRMED THAT IT HAD MADE PURCHASES OF RS.2,25, 52,526 FROM VISHAL TRADERS WHICH HAD BEEN ADDED BACK IN THE ASSESSMENT ORDER DATED 29.12.2010 AS BOGUS PURCHASES. IN AY 2009-10, GUJAR AT AMBUJA FILED RETURN ON 30.9.2009 AT RS.54,44,98,730. IN THE ASSE SSMENT ORDER DATED 29.12.2010, PURCHASES FROM VISHAL TRADERS OF RS.36, 28,531 HAVE BEEN ADDED. SIMILARLY, OTHER CONCERNS OF EDIBLE OIL GROUP CASES HAVE SHOWN HUGE PURCHASES FROM VISHAL TRADERS WHICH HAD BEEN ADDED BACK IN THE ASSESSMENT ORDERS. (7) THE RETURNS OF THE APPELLANT ARE NOT SUPPORTED BY ANY TDS CERTIFICATES TO CONFIRM THE DALALI INCOME SHOWN IN THE RETURNS. THE APPELLANT'S CLAIM THAT HE HAS WORKED FOR GUJARAT AM BUJA EXPORTS AND HAS SHOWN CORRECT DALALI INCOME IS NOT PROVED IN TH E ABSENCE OF TDS CERTIFICATES. IF THE ARGUMENT IS BELIEVED THEN THE APPELLANT WOULD NOT HAVE WORKED FOR LESS THAN 2% FROM GUJARAT AMBUJA EX PORTS, AND AS PER PURCHASES SHOWN FROM VISHAL TRADERS BY GUJARAT AMBUJA EXPORTS IN AY 2008-09 OF RS2,25,52,526, COMMISSION AT 2% CO MES TO RS.4,51,050 AND IN AY 2009-10 AT 2% OF RS.36,28,531 IT COMES TO RS.72,570. IN THE RETURN OF AY 2008-09 COMMISSION O F JUST RS.2,63,469 HAS BEEN SHOWN WITHOUT SPECIFYING FROM WHOM IT HAS BEEN RECEIVED AND IN AY 2009-10 COMMISSION AT RS.3,06,204 HAS BEEN SH OWN WITHOUT SPECIFYING FROM WHOM IT HAS BEEN RECEIVED AND AT WH AT RATE. 11. POINTS DISCUSSED IN THE ABOVE PARA PROVE THAT T HE APPELLANT WAS AN INTEGRAL PART OF BOGUS BILLS OPERATIONS CONDUCTED I N COMPLICITY WITH DHARMENDRA PANDYA AND MADANLAL SHAH. DURING APPELLA TE PROCEEDINGS HE HAS NOT STATED ANYTHING NEW WHICH WA S NOT STATED BEFORE THE ASSESSING OFFICER. THE ARGUMENT OF THE A SSESSING OFFICER THAT ALL THIS WOULD NOT BE DONE BY THE APPELLANT WI THOUT RECEIVING ANY COMMISSION IS AN ARGUMENT WHICH CANNOT BE BRUSHED A SIDE, BUT 2% ADDITION AS COMMISSION OF ALL THE DEPOSITS APPEARIN G IN THE BANK ACCOUNTS IN THE YEARS UNDER CONSIDERATION OF VISHAL TRADERS IS NOT FOUND JUSTIFIED IN TOTO, BECAUSE THE RATE OF COMMIS SION CAN ONLY BE ESTIMATED, AND THE APPELLANT WAS ACTUALLY ASSISTING THE MAIN OPERATOR- M/S. VISHAL TRADERS CONTROLLED BY SHRI MADANLAL SHA H AND SHRI DHARMENDRA PANDYA, THEREFORE, IN THE INTEREST OF JU STICE THIS COMMISSION INCOME ADDITION IS RESTRICTED TO 1% OF T HE DEPOSITS, WHICH BRINGS ADDITION OF RS.33,89,890/- IN A.Y 08-09 (1% OF RS.33,89,074) ITA NO.2381/AHD/2012 AND 4 OTHERS SHRI PIYUSH KUMAR B. ACHARYA VS. ACIT, MEHSANA 8 AND OF RS.3,69,815 IN A.Y. 2009-10 (1% OF RS.3,69,8 1,584). THE BALANCE AMOUNTS ARE DIRECTED TO BE DELETED. 7. FINDING IN THE ASSTT.YEAR 2007-08 IS ALSO IN THE SAME LINE. BUT IN THAT CASE THE LD.CIT(A) DID NOT REDUCE THE ESTIMATION OF INCOME FROM 2% TO 1%. BEFORE MAKING AN ANALYSIS OF THE IMPUGNED ORDERS, W E WOULD LIKE TO MAKE REFERENCE TO THE STATEMENT OF THE ASSESSEE RECORDED DURING THE COURSE OF SURVEY WHEREIN HE HAS DECLARED AS TO HOW HE HAS WITHDRAWN CASH FROM THE ACCOUNTS OF VISHAL TRADERS AND HOW THIS AMOUNT HAS BEEN HAND ED OVER TO MANDALAL SHAH. QUESTION NO.12 AND REPLY IS IMPORTANT FOR DE CIDING THIS CONTROVERSY. THEREFORE, IT IS PERTINENT TO TAKE OF THIS QUESTION AND REPLY: !'# $% & '#() **+,) ANN- A-1 INVENTORISED (-( *+.(*-)/0 1234#456*+.7+89# : ) ; ,)<. => #<= ?!@: A-)/0 123B# *C )- ) D4# )+89E < FG;<* <*C %D!(-)- ) D4# )<* <+89 DEBIT NOTE *+. - ) D4# ) < * < H+ C /0 123 MEHSANA NAGRIK SAHKARI BANK, ARVIND BAUG CURRENT ACCOUNT NO. I'JJ:) %./0 123 F SELF H+; %); H2 THROUGH F %K C#C CASH E CASH ; H2;;%. ENGLISH TRANSLATION: Q. 12 WE GOT PAGE NOS.1 TO 10 AND 29 TO 51 FROM YOU R OFFICE, WHICH IS INVENTORISED AS ANN-A-1. THESE PAPERS RE LATED TO VISHAL TRADERS. GIVE COMPLETE DETAILS ABOUT THE SE PAYMENTS. ITA NO.2381/AHD/2012 AND 4 OTHERS SHRI PIYUSH KUMAR B. ACHARYA VS. ACIT, MEHSANA 9 A.12 THE ABOVE PAPERS SHOWN BY YOU ARE RELATED TO V ISHAL TRADERS. THESE PAPERS WERE RECEIVED BY ME FOR GETTI NG PAYMENT FROM GUJARAT AMBUJA. OTHERS PAPERS ARE RELA TED DEBIT NOTES FOR PAYMENTS RECEIVED FROM GUJARAT AMBU JA. THE CHEQUES RECEIVED FROM GUJARAT AMBUJA, WHICH I DEPOSITED IN THE CURRENT ACCOUNT NO.6577 OF VISHAL TRADERS WITH MAHSANA NAGRIK SAHAKARI BANK, ARVIND BAUG. VISHAL TRADERS WAS GIVING ME SELF-CHEQUE WHICH WERE RECEIVED THROUGH MADANLAL CHAVAD, AND THERAFTER I WITHDREW CASH FROM THE BANK AND THE CASH WAS HANDED OVER TO MADANLAL CHAVAD. 8. THIS IS THE ONLY EVIDENCE AGAINST THE ASSESSEE F OR HABOURING A BELIEF THAT THE ASSESSEE HAS WORKED ON BEHALF OF VISHAL TR ADERS. THE LD.CIT(A) HAS TREATED TOTAL TURNOVER REFLECTED IN DIFFERENT BANK ACCOUNTS (EXTRACTED SUPRA) AS HANDLED BY THE ASSESSEE ON THE BASIS OF CIRCUMSTANT IAL EVIDENCE. THE CIRCUMSTANCES NARRATED BY THE LD.CIT(A) ARE THAT TH E ASSESSEE DID NOT SUBMIT ANY TDS CERTIFICATE TO CONFIRM DALALI INCOME SHOWN IN THE RETURNS. THE ASSESSEE DID NOT SUBMIT ENGLISH TRANSLATION OF STAT EMENT. THE ASSESSEE HAS CONFIRMED HIS WORKING FOR VISHAL TRADERS AND HE IS AN INTEGRAL PART OF THIS ISSUANCE OF BOGUS BILLS WITH SHRI DHARMENDRA PANDYA . GUJARAT AMBUJA EXPORTS FILED RETURN OF ASSTT.YEAR 2008-09 AND CONF IRMED THAT IT HAD MADE PURCHASES OF 2,25,52,526/- FROM VISHAL TRADERS WHIC H HAD BEEN ADDED BACK IN THE ASSESSMENT ORDER AS BOGUS PURCHASES. THE QUEST ION IS HOW THIS CUMULATIVE SET OF ALL THESE FACTS WOULD GOAD ADJUDI CATING AUTHORITY TO ARRIVE AT A CONCLUSION THAT THE ASSESSEE HAS CARRIED OUT ISSU ANCE OF BOGUS BILLS IN ALL THE BANKS. THE ASSESSEE IN HIS REPLY HAS ONLY CONFIRME D ABOUT TRANSACTIONS IN MEHSANA NAGRIK SAHAKARI BANK LTD. PAPERS WERE ALSO FOUND TO THIS EFFECT AT HIS PREMISES. OTHER BANK ACCOUNTS HAVE BEEN CONNEC TED WITH THE ASSESSEE ONLY ON ASSUMPTION BASIS. IT MAY BE A CASE THAT PE RSON LIKE ASSESSEE MIGHT HAVE BEEN CARRIED OUT SUCH TRANSACTIONS ON BEHALF O F VISHAL TRADERS AT ITA NO.2381/AHD/2012 AND 4 OTHERS SHRI PIYUSH KUMAR B. ACHARYA VS. ACIT, MEHSANA 10 AHMEDABAD AND OTHER CITIES WHERE THESE BANKS ARE LO CATED. THERE IS NO CONCLUSIVE PROOF WITH THE DEPARTMENT EXHIBITING THE FACT THAT TRANSACTIONS IN ALL OTHER BANKS WERE ALSO ROUTED THROUGH THE ASSESS EE OR HE HAS DEPOSITED THE CHEQUES RECEIVED FROM THE ALLEGED PURCHASER, WITHDR EW THE CASH ON THE SELF- CHEQUE ISSUED BY VISHAL TRADES AND HANDED OVER THES E CHEQUES TO SHRI DHARMENDRA PANDYA. THEREFORE, WE ARE OF THE VIEW T HAT COMMISSION INCOME IN THE HANDS OF THE ASSESSEE IS TO BE ASSESSED QUA THE TURNOVER AVAILABLE IN MEHSANA NAGRIK SAHAKARI BANK LTD. IN ASSTT.YEAR 20 07-08 NO TRANSACTIONS HAVE BEEN CARRIED OUT IN THIS BANK ACCOUNT. THEREF ORE, THERE SHOULD NOT BE ANY ADDITION IN THAT YEAR. WE ALLOW THE APPEAL OF THE ASSESSEE I.E. ITA NO.1947/AHD/2013 AND DELETE ADDITION. 9. AS FAR AS OTHER TWO YEARS ARE CONCERNED, WE FIND THAT TRANSACTIONS ARE THERE IN THE MEHSANA NAGRIK SAHAKARI BANK LTD. COM MISSION RATE ADOPTED BY THE AO AT 2% IS REASONABLE RATE IN THIS TYPE OF ACT IVITY. THE LD.CIT(A) OUGHT TO HAVE NOT REDUCED IT TO 1%. THEREFORE, WE ALLOW BOTH THE APPEALS OF THE REVENUE AND HOLD THAT WHATEVER TURNOVER IS TO BE CO NFIRMED, RATE FOR ESTIMATING THE COMMISSION INCOME WILL BE AT 2% (TWO PERCENT). 10. AS FAR AS ASSESSEES APPEAL FOR ASSTT.YEAR 2008 -09 AND 2009-10 ARE CONCERNED, WE DIRECT THE AO TO TAKE THE TURNOVER AV AILABLE IN MEHSANA NAGRIK SAHAKARI BANK LTD. I.E. TURNOVER OF RS.2,04,23,897/ - IN ASSTT.YEAR 2008-09 AND RS.37,48,108/- IN ASSTT.YEAR 2009-10. THE TOTA L TURNOVER IS TO BE COMPUTED AT RS.2,41,72,005/-. THE INCOME OF THE AS SESSEE FROM THESE ACTIVITIES IS TO BE WORKED OUT AT 2% (TWO PERCENT) OF THIS TURNOVER. THIS INCOME WILL BE IN ADDITION TO ANY OTHER INCOME DISC LOSED BY THE ASSESSEE IN BOTH THE YEARS. THE LD.COUNSEL FOR THE ASSESSEE HA S AGREED FOR THE RATE OF 2% (TWO PERCENT) AS WELL AS ESTIMATION OF INCOME AT 2% (TWO PERCENT) OF THE ITA NO.2381/AHD/2012 AND 4 OTHERS SHRI PIYUSH KUMAR B. ACHARYA VS. ACIT, MEHSANA 11 ALLEGED TURNOVER IN ADDITION TO THE INCOME DISCLOSE D BY THE ASSESSEE. WE HAVE SPECIFICALLY CONFRONTED THE LD.COUNSEL FOR THE ASSE SSEE TO THIS EFFECT AND HE DID NOT RAISE ANY OBJECTION. IN THIS WAY, ALL THESE AP PEALS ARE ALLOWED. 11. IN THE RESULT, ALL APPEALS ARE ALLOWED. ORDER PRONOUNCED IN THE COURT ON 15 TH MARCH, 2017 AT AHMEDABAD. SD/- SD/- ( AMARJIT SINGH ) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER