ACIT CEN CIR 13, MUMBAI V. NARENDRA R. SHAH, MUMBAI

ITA 2837/MUM/2011

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4175 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2016
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 10-12-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 11-04-2011
• Court: TRIBUNAL
• Department Lawyers: N P SINGH
• Keywords: Gift; Search and seizure; Loose papers; Accommodation entries

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B , BENCH MUMBAI BEFORE SHRI R.C.SHARMA , A M & SHRI RAM LAL NEGI , J M ./ ITA NO . 2637 TO 2644 /MUM /20 1 1 ( / ASSESSMENT YEAR : 200 0 - 0 1 TO 200 - 07 - 08 ) MR. NARENDRA R. SHAH, D - 28/205, YOGINAGAR, EKSAR ROAD, BORIVALI (WEST), MUMBAI - 400092 VS. ACIT, CC - 13, MUMBAI - 20 ./ ./ PAN/GIR NO. : A A PPS 6559 P ( / APPELLANT ) .. ( / RESPONDENT ) AND ./ ITA NO .2 833 TO 2 840 /MUM/2011 ( / ASSESSMENT YEAR : 2000 - 01 TO 200 - 07 - 08 ) ACIT, CC - 13, MUMBAI - 20 VS. MR. NARENDRA R. SHAH, D - 28/205, YOGINAGAR, EKSAR ROAD, BORIVALI (WEST), MUMBAI - 400092 ./ ./ PAN/GIR NO. : A APPS 6559 P ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : NONE /REVENUE BY : SHRI N.P.SINGH / DATE OF HEARING : 01 / 04 /201 6 / DATE OF PRONOUNCEMENT 06/04 /201 6 / O R D E R PER R.C.SHARMA (A.M) : TH ESE ARE THE APPEALS FILED B Y THE ASSESSEE AND REVENUE AGAINST THE ORDER OF CIT(A), MUMBAI , FOR THE ASSESSMENT YEAR S 200 0 - 2001 TO 2007 - 2008 . 2. NOBODY APPEARED ON BEHALF OF THE ASSESSEE INSTEAD OF GIVING VARIOUS O PPORTUNITIES. ON EARLIER OCCASIONS ADJOURNMENTS WERE ALSO GRANTED AT THE REQUEST OF THE ASSESSEE. THE CASE WAS FIXED ON 2 - 12 - 2014, ITA NO S . 2637 - 2644/11 & 2833 - 2840/11 2 WHEREIN LD. AR ASKED FOR ADJOURNMENT AND AT HIS REQUEST CASE WAS ADJOURNMENT TO 25 - 5 - 2015. ON 25 - 5 - 2015 NONE APPEARED ON BEHA LF OF THE ASSESSEE, THEREFORE, ONCE AGAIN CASE WAS ADJOURNED TO 10 - 12 - 2015. THE ASSESSEE WAS ISSUED NOTICE BY RPAD, HOWEVER, NONE APPEARED ON THE DATE FIXED FOR HEARING I.E. ON 10 - 12 - 2015. ACCORDINGLY, THE BENCH DECIDED TO DISPOSE THE APPEAL AFTER HEARING THE LD. DR AND GOING THROUGH THE MATERIAL PLACED ON RECORD. 3 . COMMON GRIEVANCE OF BOTH ASSESSEE AND REVENUE PERTAINS TO ESTIMATION OF RATE OF COMMISSION EARNED BY ASSESSEE ON THE ACCOMMODATION CH EQUES . 4 . WE HAVE CONSIDERED THE CONTENTIONS OF LD. DR AN D GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. FACTS IN BRIEF ARE THAT THE ASSESSEES RESIDENCE AS WELL AS OFFICE PREMISES WERE COVERED BY SEARCH AND SEIZURE ACTION U/S.132 OF THE ACT AND AT ONE PLACE SURVEY U/S.133A WAS ALSO CARRIED OUT BY THE INVESTIGAT ION WING. DURING THE COURSE OF SEARCH AND SURVEY PROCEEDINGS VARIOUS DOCUMENTS, REGISTERS, LOOSE PAPERS WERE FOUND AND WERE ALSO SEIZED/IMPOUNDED BY THE DY. DIRECTOR OF INCOME TAX (INVESTIGATION). THE STATEMENTS OF THE ASSESSEE WERE RECORDED ON VARIOUS DAT ES IN THE COURSE OF SEARCH AND IN POST SEARCH INQUIRIES. DURING THE COURSE OF THE SAID SEARCH AND SEIZURE ACTIONS THE ASSESSEE ADMITTED BEFORE THE DDIT(INV) THAT HE WAS ENGAGED IN PROVIDING VARIOUS FINANCIAL ACCOMMODATION ENTRIES TO THE NEEDY PERSONS. THES E ACCOMMODATION ENTRIES INCLUDED PROVIDING SPECULATION PROFIT, ARTIFICIAL LONG TERM CAPITAL GAINS PROVIDING SHARE APPLICATION MONEY, PROVIDING GI FTS/DONATIONS ETC. ITA NO S . 2637 - 2644/11 & 2833 - 2840/11 3 FOR THIS PURPOSE A VAST NETWORK OF VARIOUS BANK ACCOUNTS W ERE CREATED BY THE ASSESSEE & SCOR ES OF BANK ACCOUNTS WERE OPENED IN THE NAME OF ASSESSEE HIMSELF AND IN HIS PROPRIETARY CO N CERNS NAMES AND ALSO IN THE NAME OF FAMILY MEMBERS / ENTITIES FULLY CONTROLLED BY HIM. IN THE COURSE OF SEARCH AND SEIZURE PROCEEDINGS THE DATA WAS FOUND ON COMPUTER OF THE ASSESSEE WHICH WERE SEIZED IN THE HARD DISK / CD' S BY THE DEPARTMENT. THESE DETAILS INCLUDE THE NAMES AND ADDRESSES OF SOME BENEFICIARIES WHO AVAILED THE FINANCIAL ACCOMMODATION 'ENTRIES FOR LONG TERM CAPITAL GAINS, SPECULATION PROFIT, SHARE APPLICA TION MONEY, GIFTS / DONATIONS ETC. THE ASSESSEE FURNISHED THE RETURNS OF INCOME U/S.153A AND U/S.L39(1) FOR A.Y. 2000 - 01 TO 2007 - 08, AFTER SEARCH ACTION FOR VARIOUS YEARS AS UNDER: - SR.NO. ASSESSMENT YEAR DATE OF FILING OF RETURN TOTAL INCOME DECLARED (RS ) INCOME ASSESSED (RS.) 1 2000 - 2001 28.04.2008 1,51,424 28,05,247 2 2001 - 2002 28.04.2008 1,09,273 15,40,909 3 2002 - 2003 28.04.2008 1,61,610 1,59,10,056 4 2003 - 2004 28.04.2008 3,25,326 2,25,78,906 5 2004 - 2005 29.04.2008 13,02,498 3,95,21,741 6 2005 - 20 06 29.04.2008 9,53,045 4,93,41,451 7 2006 - 2007 28.04.2008 7,42,383 5,01,89,960 8 2007 - 2008 30.03.2009 2,48,920 1,61,03,620 IN THE COURSE OF ASSESSMENT PROCEEDINGS SPECIAL AUDIT WAS DIRECTED TO BE CARRIED OUT U/S.142(2A) OF THE INCOME TAX ACT, 1961. THE AUDIT WAS CARRIED OUT BY THE AUDITORS APPOINTED. THE ASSESSING OFFICER MADE A DETAILED ANALYSIS OF VARIOUS BANK ACCOUNTS OF VARIOUS ENTITIES FULLY CONTROLLED BY THE ASSESSEE AND THE SUMMARY OF CHEQUES ISSUED FROM THE BANK ACCOUNTS WERE PREPARED AND THE AG GREGATE AMOUNT OF CHEQUES ISSUED WAS QUANTIFIED FOR THE PURPOSE OF APPLYING THE RATE OF COMMISSION ITA NO S . 2637 - 2644/11 & 2833 - 2840/11 4 FOR GIVING ACCOMMODATION ENTRIES AND IN THIS MANNER THE INCOME OF THE ASSESSEE WAS ESTIMATED FOR THE VARIOUS ASSESSMENT YEARS INVOLVED. AT THE SAME TIME THE A.O. WORKED OUT THE AMOUNT OF CHEQUES DEPOSITED IN THE BANK ACCOUNTS OF THE ASSESSEE AND HE APPLIED THE RATE OF COMMISSION ON THIS AMOUNT AND ASSESSED THE INCOME IN THE HANDS OF THE ASSESSEE . BOTH THESE FIGURES WERE CONSIDERED IN THE ASSESSMENTS UNDER APPE AL. THE LIST OF SAID BANK ACCOUNTS FOR WHICH THE INCOME WAS ESTIMATED ARE APPENDED TO THE ASSESSMENT ORDERS OF THE RESPECTIVE YEARS. THE RATE OF COMMISSION WAS APPLIED @5 % OF THE AMOUNT OF CHE QUES ISSUED AS WELL AS OF THE AMOUNT OF CHEQUES DEPOSITED. THE M ODUS OPERANDI OF THE ASSESSEE HAS BEEN EXPLAINED' BY THE A.O. IN DETAIL IN THE ASSESSMENT ORDER FOR VARIOUS YEARS AND BRIEFLY STATED THE SAME WAS THAT THE BENEFICIARIES THROUGH PENNY STOCK ENTRY PROVIDERS/MIDDLEMEN APPROACHED THE ASSESSEE FOR TAKING FINANC IAL ACCOMMODATION ENTRIES FOR A RTIFICIAL SPECULATION PROFIT, ARTIFICIAL LONG TERM CAPITAL GAINS ETC. THE ASSESSEE USED TO RECEIVE THE AMOUNT FROM THOSE PERSONS AND THE SAME WERE DEPOSITED IN THE BANK ACCOUNTS FROM WHERE THE CHEQUES WERE ISSUED TO THE BENE FICIARIES. SOMETIMES THE AMOUNT WAS TRANSFERRED FROM' ONE BANK ACCOUNT TO ANOTHER BANK ACCOUNT AND THEREAFTER THE CHEQUES WERE ISSUED TO THE BENEFICIARIES. IN SUM AND SUBSTANCE THE ASSESSEE WAS FOUND TO BE USING THE BANK ACCOUNTS FOR THE PURPOSE OF PROVIDI NG THESE ACCOMMODATION ENTRIES AND IN SUPPORT OF THESE ENTRIES HE ISSUED / PREPARED THE BILLS, INVOICES FOR SALE / PURCHASE OF THE SHARES ETC. AS THE ITA NO S . 2637 - 2644/11 & 2833 - 2840/11 5 CASE MAY . BE TO GIVE COLOUR AND SHOW THAT ACTUAL TRANSACTION HAS TAKEN PLACE. 5 . BY THE IMPUGNED ORDER, T HE CIT(A) MODIFIED THE PROFIT RATE AFTER OBSERVING AS UNDER : - 7 .1. I HAVE CAREFULLY AND DISPASSIONATELY CONSIDERED VARIOUS SUBMISSIONS OF THE APPELLANT ON VARIOUS DISPUTED ISSUES. I HAVE PERUSED THE ASSESSMENT ORDER AND THE REASONS GIVEN BY THE A.O. FOR ESTIMATI N G THE GROSS COMMISSION @5 % OF THE AMOUNT OF CHEQUES ISSUED FROM THE BANK ACCOUNTS FOR V ARIOUS FINANCIAL ACCOMMODATION ENTRIES. THE BASIS OF THE A.O IS THAT DEPARTMENT HAS GOT INFORMATION THAT IN THIS TYPE OF ACTIVITY PREVAILING RATE WAS 5 % OF THE AMOUNT OF CHEQUE ISSUED. FOR THIS PROPOSITION THE A.O CITED THE REFERENCE OF J AYANT B.PATEL WHO WAS ONE OF THE BENEFICIARIES OF THE ACCOMMODATION ENTRIES GIVEN BY THE APPELLANT. IN PARA 14.1 OF THE ASSESSMENT ORDER FOR A.Y.2006 - 07 THE A.O STATED THAT JAY ANT B.PATEL HAD ADMITTED TO HAVE PAID 7% COMMISSION FOR OBTAINING THE LONG TERM CAPITAL GAINS. IN RESPONSE TO THE AOS PROPOSAL THE APPELLANT STATED THAT THE COMMISSION RECEIVED FROM JAYANT B.PATEL WAS 2 % AND NOT 7% . SECONDLY, HE PRODUCED THE CONFIRMATION O F THE MIDDLEMEN MR.NIRAJ KANTHILAL SHAH TO THE EFFECT THAT ONLY 2% WAS PAID BY HIM TO THE APPELLANT. THE APPELLANT PRODUCED THIS MIDDLEMEN BEFORE THE A.O. ALL THESE FACTS ARE NARRATED IN THE ASSESSMENT ORDER BY THE A.O. THE ASSESSING OFFICER FURTHER ADMITS IN THE ASSESSMENT ORDER THAT J AYANT B.PATEL HAS ADMITTED TO HAVE OBTAINED THE LONG TERM CAPITAL GAINS THROUGH THE MIDDLEMEN NIRAJ KANTILAL SHAH IN THE CROSS EXAMINATION ALSO JAYANT B.PATEL WAS STATED TO HAVE PAID 2 TO 3% AS COMMISSION FOR OBTAINING THE A RTIFICIAL LONG TERM CAPITAL GAINS. THE A.O. FURTHER MADE REFERENCE OF TWO PARTIES NAMELY SUNIL PACHIGAR AND MR .NARROTAM SHAH WHO HAS STATED TO HAVE PAID 5'0 AS COMMISSION FOR OBTAINING THE LONG TERM CAPITAL GAINS. THE APPELLANT IN THE PROCEEDINGS STATED THAT NO COPIES OF STATEMENT OF THESE PERSONS WERE GIVEN AND INSPIRE OF SEVERAL REQUESTS THE A.O HAS NOT GIVEN THE COPIES TILL DATE. THE FACT OF INVOLVEMENT OF MIDDLEMEN AND SUB - BROKERS ARE NOT IN DISPUTE AS EVEN THE A.O HAS ADMITTED THIS FACT. THE SEIZED MATERIALS ALSO POINT TO THIS FACT. THE MODUS OPERANDI OF THE APPELLANT, AS DETECTED BY THE INVESTIGATION WING AND THE ASSESSING OFFICER FURTHER CONFIRM THE INVOLVEMENT OF SUB - BROKERS AND MIDDLEMEN. IT IS ALSO NOT DISPUTED THAT MIDDLEMEN WOULD TAKE THEIR PA RT OF COMMISSION AND WHOLE AMOUNT WOULD OBVIOUSLY NOT BE PAID TO THE APPELLANT BY THEM. THUS EVEN IF THE STATEMENTS OF NAROTTAM SHAH AND SUNIL PACHIGAR ARE TAKEN TO BE CORRECT, THEN OUT OF SUCH 5% THE MIDDLEMEN WOULD POCKET NORMALLY 2% AND REMAINING AMOUNT CAN BE SAID TO BE GIVEN TO THE APPELLANT WHICH WOULD BE 3 % . THUS THE APPELLANT'S COMMISSION INCOME BY AND LARGE WAS ABOUT 3% FOR LONG TERM CAPITAL GAINS WHICH IS ALSO SUPPORTED BY ITA NO S . 2637 - 2644/11 & 2833 - 2840/11 6 THE SEIZED MATERIAL WHICH CONTAIN REFERENCE OF COMMISSION BETWEEN THE RANGE OF 1.57% TO 3.5%. IN THIS VIEW OF THE MATTER , IF THE SEIZED MATERIAL IS CONSIDERED THEN THE AVERAGE RATE OF COMMISSION RECEIVED IS REPORTED AT ABOUT 3I'O. THE STATEMENTS OF MIDDLEMEN INDICATE THAT THE APPELLANT'S COMMISSION WAS 5I'O MINUS MIDDLEMEN COMMIS SION OF ABOUT 2 % . IN THE STATEMENT RECORDED U/S.131 ON OATH BEFORE THE DDIT, THE APPELLANT ADMITTED TO HAVE EARNED COMMISSION FOR PROVIDING LONG TERM CAPITAL GAINS @2 TO 3 % SUBJECT TO THE CLAIM OF EXPENSES. CONSIDERING THE TOTALITY OF THE CIRCUMSTANCES, VA RIOUS EVIDENCES BROUGHT ON RECORD, THE SEIZED MATERIAL WHICH, CONTAIN THE RATE OF COMMISSION CHARGED BY THE APPELLANT, I AM OF THE VIEW THAT IT WOULD BE FAIR AND REASONABLE TO ADOPT THE 'RATE OF COMMISSION @3 % OF THE AMOUNT OF CHEQUES ISSUED OR BANK DEPOSI TS' WHICHEVER IS HIGHER, FOR THE PURPOSE OF LONG TERM CAPITAL GAINS AND OTHER ACCOMMODATION ENTRIES PROVIDED BY THE APPELLANT. REGARDING THE CLAIM OF EXPENSES I FIND THAT THE EXPENSES WERE CLAIMED ON ADHOC BASIS AS THE PERCENTAGE OF THE GROSS COMMISSION. T HE GROSS COMMISSION WAS ESTIMATED AT THE TIME OF FILING THE RETURN ON THE BASIS OF THE AVAILABLE BANK STATEMENTS. IN THE PROCEEDINGS THE A.O CALLED FOR THE STATEMENTS FROM VARIOUS BANKS AND ON THAT BASIS THE APPELLANT PREPARED THE SUMMARY OF CHEQUES ISSUED AND WORKED OUT THE AMOUNT OF GROSS COMMISSION WHICH WAS SUBSTANTIALLY HIGHER. IT IS AN ADMITTED FACT ON RECORD THAT THE APPELLANT WAS NOT MAINTAINING ANY BOOKS OF ACCOUNT 'AND THEREFORE THE EXPENSES WERE CLAIMED ON ADHOC ESTIMATION AND THE GROSS COMMISSIO N WAS ALSO ESTIMATED ON ADHOC PERCENTAGE BASIS. THE WHOLE THINGS ARE BASED ON ESTIMATION. THE A.O. INCREASED THE ESTIMATION OF GROSS COMMISSION BY TAKING HIGHER FIGURE BUT DID NOT INCREASE 'THE EXPENSES CORRESPONDINGLY. THE APPELLANT CLAIMED EXPENSES @20% OF GROSS COMMISSION FOR SPECULATION PROFIT ENTRIES AND 50% OF GROSS COMMISSION FOR LONG TERM CAPITAL GAINS WHERE THE INCIDENCE OF EXPENSE WAS STARTED TO BE HIGHER. I ALSO PERUSED THE HON'BLE ITATS ORDER IN THE C A SE OF SUMERMAL R.JAIN (SUPRA) WHEREIN THE C LAIM OF EXPENSES ON ADHOC BASIS OF THE GROSS COMMISSION DETERMINED WAS' CONSIDERED. IN THAT CASE THE ASSESSEE CLAIMED THE EXPENSES @25 % OF THE GROSS COMMISSION. THE A.O ESTIMATED 'THE COMMISSION INCOME @1 % BUT DID NOT ALLOW ANY EXPENSES. THE ITAT CONSIDERI NG THE CLAIM OF EXPENSES REDUCED THE FINAL ESTIMATION OF INCOME @ 0.5 % OF THE BANK DEPOSITS. THE SAID ASSESSEE WAS ALSO FOUND TO BE INVOLVED IN GIVING BOGUS HAWALA ENTRIES BY ISSUING CHEQUES AND DEPOSITING THE AMOUNT IN BANK ACCOUNTS. VIEWING THE FACTS COL LECTIVELY I AM OF THE VIEW THAT CLAIM OF EXPENSES ON ADHOC BASIS OF THE GROSS COMMISSION NEEDS TO BE UPHELD AND ALLOWED TO THE ASSESSEE BECAUSE THE INCIDENCE OF EXPENSES CANNOT BE RULED OUT IN THIS ACTIVITY AND IN FACT THE A.O HAS ACCEPTED IN PRINCIPLE THE APPELLANT'S CLAIM OF EXPENSES FROM THE GROSS COMMISSION AND STATED THAT IT IS TO BE ALLOWED (AS STATED IN PARA 24 OF THE ASSESSMENT ORDER FOR THE A.Y.2006 - 07 ON PAGE 38). IT IS THEREFORE QUITE OBVIOUS THAT THE CLAIM OF EXPENSES ON FINALLY DETERMINED GROSS COMMISSION NEEDS TO BE CONSIDERED. I DON'T FIND FORCE IN THE ARGUMENT OF THE ASSESSEE THAT 50% OF THE GROSS COMMISSION IS ALLOWABLE. FIRSTLY, THE APPELLANT HAS ITA NO S . 2637 - 2644/11 & 2833 - 2840/11 7 NOT GIVEN ANY BIFURCATION OF THE TURNOVER AND THE CHEQUES ISSUED FOR THE PURPOSE OF LONG TERM C APITAL GAINS AND FOR SPECULATION PROFIT ETC. IT IS FOR THE APPELLANT TO GIVE SUCH BIFURCATION AND SUBSTANTIATE THE SAME WHICH HAS NOT BEEN DONE IN THIS CASE. I HAVE NO OTHER OPTION BUT TO REJECT THIS CLAIM OF 50 % OF EXPENSES. HAVING REGARD TO FACTS AND CIR CUMSTANCES IT WOULD BE FAIR AND REASONABLE IF THE CLAIM OF EXPENSES @ 20 % OF GRO SS $ COMMISSION FINALLY DETERMINED IS UPHELD. THUS 20'0 OF GROSS COMMISSION' (WHICH IS UPHELD IN THIS ORDER @3% IN THIS CASE ARE CONSIDERED AS ALLOWABLE EXPENSES. THE APPELLANT WOULD GET THE PART RELIEF ACCORDINGLY AND THE AMOUNT OF INCOME DETERMINED TO BE MODIFIED TO THIS EXTENT. THIS GROUND IS PARTLY ALLOWED. THE UNDISCLOSED COMMISSION INCOME DETERMINED ON THE AMOUNT OF TURNOVER OF CHEQUES ISSUED FROM THE BANK ACCOUNTS OF THE A PPELLANT AFTER EFFECT OF THIS ORDER WOULD BE AS UNDER (SUBJECT TO VERIFICATION OF FACTS AND FIGUR E BY THE A. O ) . NARENDRA R.SHAH SL. NO. ASSESSMENT YEAR TURNOVER OF CHEQUES ISSUED AMOUNT (RS.) GROSS COMMISSION @3% OF BANK DEPOSITS OR CHEUQES ISSUED 20% OF GROSS COMMISSION (I.E.0.6%) NET INCOME(RS.) 1 2000 - 2001 35,856,633 1,075,699 215,139 860,560 2 2001 - 2002 21,765,767 652,973 130,594 522,379 3 2002 - 2003 205,218,139 6,156,544 1,231,308 4,925,236 4 2003 - 2004 204,456,366 6,133,690 1,226,738 4,906,952 5 2004 - 2005 179,636,035 5,389,081 1,077,816 4,311,265 6 2005 - 2006 397,581,228 11,927,437 2,385,487 9,541,950 7 2006 - 2007 383,582,234 11,507,467 2,301,493 9,205,974 8 2007 - 2008 70,120,944 2,103,628 420,725 1,682,903 TOTAL 1,498,217,346 44,946,519 8,98 9,300 35,957,219 LD. AO IS DIRECTED TO GIVE EFFECT AFTER DUE VERIFICATION OF FACTS AND FIGURES AS DISCUSSED ABOVE. THE GROUND NOS. 1,4 AND 5 OF THE APPEALS FOR A.Y.2000 - 2001 TO 2006 - 2007 AND THE GROUND NOS.1,3,4,&5 OF THE APPEAL FOR A.Y.2007 - 08 ARE DISPO SED OFF ACCORDINGLY. 6 . AGAINST THE ABOVE ORDER OF CIT(A) BOTH ASSESSEE AND REVENUE ARE IN APPEALS BEFORE US. 7 . IN ALL THE APPEALS, THE ASSESSEE IS AGGRIEVED BY THE ACTION OF CIT(A) FOR NOT ACCEPTING THE COMMISSION @0.4% AS OFFERED BY THE ASSESSEE AND F OR CONFIRMING THE COMMISSION RATE OF 2.40%. HOWEVER, THE REVENUE IS AGGRIEVED BY THE ACTION OF CIT(A) DIRECTING TO ADOPT RATE OF COMMISSION AT ITA NO S . 2637 - 2644/11 & 2833 - 2840/11 8 3% AS AGAINST 5% APPLIED BY AO , MERELY RELYING ON ONLY ONE CONFIRMATION WITHOUT APPRECIATING OTHER DOCUMENTARY EV IDENCE CONFIRMING THE PAYMENT OF COMMISSION @5% TO 7%. THE REVENUE IS ALSO AGGRIEVED FOR ALLOWING CLAIM OF EXPENSES AT 20% OF GROSS COMMISSION. 8 . WE HAVE CAREFULLY GONE THROUGH THE ORDERS OF AUTHORITIES BELOW AND ALSO CONSIDERED THE CONTENTION OF LD. DR AS WELL AS MATERIAL PLACED ON RECORD. WE FOUND THAT AS A RESULT OF SEARCH AND SURVEY, THE AO HAS FOUND THAT ASSESSEE WAS ENGAGED IN GIVING ACCOMMODATION ENTRY ON WHICH ASSESSEE HAS EARNED COMMISSION INCOME OF 5 TO 7%. ACCORDINGLY THE AO ESTIMATED ASSESSEE S INCOME IN THE FORM OF COMMISSION @5% ON THE AMOUNT OF CHEQUES ISSUED. IN AN APPEAL FILED BY THE ASSESSEE BEFORE CIT(A), THE CIT(A) AFTER CONSIDERATION ENTIRE SEIZED MATERIAL AS WELL AS STATEMENT OF VARIOUS PERSONS RECORDED DURING SEARCH CAME TO THE CONCL USION THAT ASSESSEE HAS EARNED COMMISSION INCOME OF 3%. THEREAFTER BY APPLYING THE RATIO LAID DOWN BY COORDINATE BENCH IN THE CASE OF SUMERMAL R. JAIN (SUPRA), THE CIT(A) ALSO ALLOWED EXPENSES OF 20% OF GROSS COMMISSION, THUS, ARRIVED AT NET COMMISSION OF RS.2.6% AS AGAINST COMMISSION INCOME OF 0.4% AS OFFERED BY THE ASSESSEE. WE FOUND THAT CIT(A) HAS DEALT WITH THE ISSUE IN GREAT DETAIL AND AFTER CONSIDERING ENTIRE MATERIAL ON RECORD REACHED TO THE FINDING THAT ESTIMATION OF COMMISSION @3% ON CHEQUE AMOUNT AND 20% ON EXPENDITURE WILL BE FAIR AND REASONABLE. NOTHING WAS BROUGHT ON RECORD SO AS TO PERSUADE US TO DEVIATE FROM THE FINDINGS RECORDED BY CIT(A) FOR ARRIVING AT THIS CONCLUSION. ACCORDINGLY, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ITA NO S . 2637 - 2644/11 & 2833 - 2840/11 9 ORDER OF CI T(A) FOR UPHOLDING THE NET COMMISSION TO THE INCOME OF 2.4%. IN VIEW OF THE ABOVE, GROUND TAKEN BY THE ASSESSEE WITH REGARD TO ESTIMATION OF COMMISSION RATE ARE HEREBY DISMISSED. 9 . IN A.Y.2003 - 04, 2004 - 05, 2005 - 06, 2006 - 07 & 2007 - 08, THE ASSESSEE IS ALSO AGGRIEVED BY ACTION OF CIT(A) FOR CONFIRMING PROTECTIVE ADDITION ON ACCOUNT OF TRANSACTIONS OF G.R.PANDYA SHARES AND SECURITIES LTD.. WE FOUND THAT DETAILED REASONING HAS BEEN GIVEN BY CIT(A) FOR CONFIRMING THIS PROTECTIVE ADDITIONS IN ALL THESE YEARS. AC CORDINGLY, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A) CONFIRMING THIS PROTECTIVE ADDITIONS. 10 . IN A.Y.2004 - 05 TO 2006 - 07, THE ASSESSEE IS ALSO AGGRIEVED FOR CONFIRMING PROTECTIVE ADDITION ON ACCOUNT OF TRANSACTION WITH T.H.VAKIL SHARES AND SECURITIES PVT. LTD. WE FOUND THAT DETAILED FINDING HAS BEEN GIVEN BOTH BY AO AND CIT(A) FOR THIS PROTECTIVE ADDITION. NOTHING WAS BROUGHT ON RECORD BEFORE US TO PERSUADE US TO DEVIATE FROM THE FINDINGS RECORDED BY LOWER AUTHORITIES. ACCORDINGLY, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A) CONFIRMING THE PROTECTIVE ADDITION ON ACCOUNT OF TRANSACTION WITH T.H.VAKIL SHARES AND SECURITIES PVT. LTD. 11 . IN THE RESULT, ALL THE APPEAL S OF THE ASSESSEE AND REVENUE ARE DISMISSED . O RDER PRONOUNC ED IN THE OPEN COURT ON THIS 06/04 / 201 6 . SD/ - SD/ - ( RAM LAL NEGI ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 06/04 /201 6 . . /PKM , . / PS ITA NO S . 2637 - 2644/11 & 2833 - 2840/11 10 / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//