DHARMENDRA A BABEL, MUMBAI V. DCIT CEN CIR 8(3), MUMBAI

ITA 1967/MUM/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 2778 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-11-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2012-2013
• Appeal Filed On: 20-03-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: CHAITANYA ANJARIA
• Keywords: Unexplained expenditure; Accommodation entries
• Section: 133A; 131; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA, AM AND SHRI RAVISH SOOD, JM ITA NO. 1967/MUM/2017 ( ASSESSMENT YEAR: 2012 - 13 ) SHRI DHARMENDRA A. BABEL RMR & CO. (CHARTERED ACCOUNTANTS) 425, THE SUMMIT BUSINESS BAY, NEA R WEH METRO STATION, PRAKASHWADI, ANDHERI (E), MUMBAI - 400 093 VS. DY. CIT, CENTRAL CIRCLE - 8(3), ROOM NO. 676/A, AYAKAR BHAVAN, M. K. ROAD, MUMBAI - 400 020 PAN/GIR NO. ADVPJ 5757 F ( APPELLANT ) : ( RESPONDENT ) APPELLANT BY : NONE RESPONDENT BY : SHRI CHAITANYA ANJARIA DATE OF HEARING : 23.10.2018 DATE OF PRONOUNCEMENT : 05 .11 .2018 O R D E R PER SHAMIM YAHYA, A. M.: THIS A PPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE O RDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 50, MUMBA I (LD.CIT(A) FOR SHORT) DATED 15.12.2016 AND PERTAINS TO THE A SSESSMENT YEAR (A.Y.) 2012 - 13. 2. THE GROUNDS OF APPEAL READ AS UNDER: 1. THE HONBLE CIT(APPEALS) HAS ERRED IN CONFIRMING THE ADDITION OF RS.1,87,41,330/ - AS COMMISSION @ 0.5% OF SALES. 2. T HE HONBLE CIT(APPEALS) HAS ERRED IN CONFIRMING THE ADDITION OF RS.12,00,000/ - AS UNEXPLAINED EXPENDITURE FOR APPELLANT PERSONAL EXPENDITURE. 2 ITA NO. 1967/MUM/2017 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE BELONGS TO SURAT DIAMOND GROUP. A SEARCH AND SURVEY OPERATION U/S. 132 OF THE ACT WAS CONDUCTED ON SURAT DIAMOND GROUP. A SURVEY U/S. 133A IN THE CASE OF THE ASSESSEE WAS CONDUCTED ON 05.10.2013. A STATEMENT OF THE ASSESSEE WAS RECORDED U/S. 131 OF THE ACT O N 05.10.2013. IN HIS STATEMENT, THE ASSESSEE STATED THAT HI S PROPRIET ORSHIP CONCERN M/S. RAJAN GEMS W AS ACTUALLY A PAPER CONCERN AND HAD PROVIDED ACCOMMODATION ENTRIES. ON THE BASIS OF THE STATEMENT, THE ASSESSING OFFICER (A.O. FOR SHORT ) REJECTED THE BOOKS OF THE ASSESSEE. THE A.O. PROCEEDED TO COMPUTE 0.5% OF TH E TURNOVER OF RS.3,96,88,26,976/ - AS INCOME OF THE ASSESSEE RESULTING IN COMMISSION INCOME OF RS.1,98,44,135/ - . 4. UPON THE ASSESSEES APPEAL, THE LD. CIT(A) NOTED THAT THE ASSESSEE HAS SUBMITTED THAT THE INCOME TAX AUTHORITIES HAD ISSUED THREAT S AND CO E RCION. THE LD. CIT(A) FOUND THAT THERE WAS NO EVIDENCE FOR THE SAME. HE FURTHER NOTED THAT SUBSEQUENTLY THERE WAS NO RESPONSE FROM THE ASSESSEE. HE CONFIRMED THE ORDER PASSED BY THE A.O. 5. FURTHER THE LD. CIT(A) DIRECTED AN ENHANCEMENT OF RS.12 LACS O N THE GROUND THAT THERE WAS NO SUFFICIENT WITHDRAWAL FOR PERSONAL EXPENDITURE. HE NOTED THAT THE ASSESSEE HAD NOT RESPONDED TO THE ENHANCEMENT NOTICE. 6. AGAINST THE ABOVE ORDER, THE ASSESSEE IS IN APPEAL BEFORE US. 3 ITA NO. 1967/MUM/2017 7. WE HAVE HEARD THE LD. DEPARTMENTA L REPRESENTATIVE. NONE APPEARED ON BEHALF OF THE ASSESSEE. IN OUR CONSIDERED OPINION, THE ISSUES RAISED CAN BE ADJUDICATED BY HEARING THE LD. DEPARTMENTAL REPRESENTATIVE AND PERUSING THE RECORDS. WE NOTE THAT THE ASSESSEE HAS HIMSELF ACCEPTED THAT HE WAS I NDULGING IN PROVIDING BOGUS ACCOMMODATING ENTRY. IN THESE CIRCUMSTANCES, THE BOOKS WERE REJECTED AND 0.5% OF THE TURNOVER WAS ESTIMATED AS COMMISSION INCOME OF THE ASSESSEE . E XCEPT FOR SUBMITTING THAT THE ASSESSEE HAS MADE THE STATEMENT DUE TO THREATS AND COERCION , N O EVIDENCE HAS BEEN BROUGHT BY THE ASSESSEE ON RECORD IN SUPPORT OF THE CONTENTION . WE NOTE THAT THE LD. CIT(A) HAS RIGHTLY NOTED THAT THE ASSESSEES STATEMENT THAT HE HAD ACCEPTED THAT HE IS BOGUS ACCOMMODATION ENTRY PROVIDER AND THE SAME WAS D ONE UNDER C OERCION IS CLEARLY AN AFTERTHOUGHT. 8. WE FIND THAT THE TURNOVER CLAIMED BY THE ASSESSEE IS RS.3,96,88,26,976/ - . O N THE PREMISE THAT THE TURNOVER REPRESENT BOGUS ACCOMMODATION ENTRY PROVIDED BY THE ASSESSEE, 0.5% THEREOF AMOUNTING TO RS.1,98,4 4,135/ - HAS BEEN COMPUTED AS ASSESSEES COMMISSION INCOME. IN ABSENCE OF ANY COGENT EVIDENCE BROUGHT BY THE ASSESSEE TO REBUT THE SAME, WE DO NOT FIND ANY INFIRMITY IN THE SAME. RATHER, WE FIND THAT THE ORDERS OF THE AUTHORITIES BELOW ARE RATHER REASONABLE . ACCORDINGLY, WE DO NOT FIND ANY INFIRMITY IN THE ORDERS OF THE AUTHORITIES BELOW. HENCE, WE CONFIRM THE SAME. 4 ITA NO. 1967/MUM/2017 9. IN THE RESULT, TH IS APPEAL BY THE ASSESSEE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 05.11.2018 SD/ - SD/ - ( RAVISH SOO D ) (S HAMIM YAHYA) J UDICIAL MEMBER A CCOUNTANT MEMBER MUMBAI ; DATED : 05.11.2018 ROSHANI , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. TH E CIT(A) 4. CIT - CONCERNED 5. DR, ITAT, MUMBAI 6. GUARD F ILE BY ORDER, (DY./ASSTT. REGISTRAR) ITAT, MUMBAI