DILIP JAYANTILAL SHAH, MUMBAI V. DCIT CEN CIR 31, MUMBAI

ITA 2867/MUM/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4578 (ITAT-MUMBAI)
• Duration Of Justice: 8 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-01-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 13-05-2015
• Court: TRIBUNAL
• Department Lawyers: SUNITA BILLA
• Assessee Lawyers: VIJAY KOTHARI
• Keywords: Search and seizure; Accommodation entries
• Section: 143(3); 153A

Judgement Text

, - , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI , ! ' , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, ITA NO.2867/MUM/2015 ASSESSMENT YEAR: 2009-10 SHRI DILIP JAYANTILAL SHAH, A/302, WHITE ARCH, MATHURDAS ROAD, KANDIVALI WEST, MUMBAI-400067 / VS. DCIT, CENTRAL CIRCLE-31, MUMBAI / ASSESSEE / REVENUE P.A. NO. ASIPS1677F $ % & / ASSESSEE BY SHRI VIJAY KOTHARI $ % & / REVENUE BY SMT. SUNITA BILLA CIT-DR / DATE OF HEARING 14/01/2016 & / DATE OF ORDER: 15/01/2016 & / O R D E R THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DATED 10/02/2015 OF THE LD. FIRST APPELLATE AUTHORI TY, MUMBAI. THE ONLY GROUND RAISED IN THIS APPEAL PERTA INS TO ESTIMATING COMMISSION AT THE RATE OF 0.50% INSTEAD OF 0.10%, RESULTING INTO ADDITION OF RS.13,11,122/-. ITA NO.2867/MUM/2015 DILIP JAYANTILAL SHAH 2 2. DURING HEARING OF THIS APPEAL, THE LD. COUNSEL FOR THE ASSESSEE, SHRI VIJAY KOTHARI, ADVANCED ARGUMENT , WHICH IS IDENTICAL TO THE GROUND RAISED BY EXPLAINI NG THAT FOR ASSESSMENT YEAR 2011-12, SIMILAR ADDITION WAS M ADE FOR THE ENTIRE CHAIN, WHO EARNED THE COMMISSION TO THE EXTENT OF 0.50%, OUT OF WHICH THE ASSESSEE RECEIVED MEAGER AMOUNT. IT WAS FURTHER ASSERTED THAT AD-HOC ADDITI ON HAS BEEN MADE BY THE ASSESSING OFFICER SIMPLY TO PROTEC T THE INTEREST OF THE REVENUE AGAINST THE DISCLOSE PERCEN TAGE OF 0.01% . ON THE OTHER HAND, THE LD. DR, SMT. SUNITA BILLA, DEFENDED THE ADDITION BY MAKING A REFERENCE TO A. Y . 2011- 12. IN NUT SHELL, THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) WAS DEFENDED. 2.1. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE WAS EMPLOYEE OF M/S AVON CORPORATION LTD., DECLARED INCOME OF RS.1,68,740/-. SUBSEQUENTLY, A SEARCH AND SEIZURE OPERATION U/S 13 2(1) OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT) WAS CARRIED OUT ON AVON CORPORATION GROUP ON 04/02/2011 AND ALS O THE PREMISES OF THE ASSESSEE. CERTAIN DOCUMENTS WER E RECOVERED FROM THE PREMISES OF M/S AVON CORPORATION AND ALSO FROM THE ASSESSEE, INDICATING THAT THE ASSESSE E WAS ENGAGED IN PROVIDING ACCOMMODATION ENTRIES OF SALES AND PURCHASES TO VARIOUS COMPANIES INCLUDING M/S. AVON CORPORATION LTD. FOR WHICH THE ASSESSEE WAS CHARGIN G COMMISSION. STATEMENT OF THE ASSESSEE WAS RECORDED , ITA NO.2867/MUM/2015 DILIP JAYANTILAL SHAH 3 WHEREIN, HE ADMITTED THAT HE WAS GETTING COMMISSION RANGING FROM 0.02% TO 0.10%. PURSUANT TO NOTICE U/ S 153A OF THE ACT, THE ASSESSEE FILED RETURN AT RS.3, 70,750/- OFFERING ADDITIONAL INCOME OF RS.2,02,715/- FROM TH E BUSINESS OF ACCOMMODATION ENTRIES. HOWEVER, WHILE COMPLETING THE ASSESSMENT, THE LD. ASSESSING OFFICE R ESTIMATED THE INCOME AT THE RATE OF 0.50% ON THE TO TAL TRANSACTION OF RS.26,22,09,363/-, THUS, THE INCOME WAS ESTIMATED AT RS.13,11,047/-. FINALLY, THE ASSESSME NT WAS COMPLETED AT RS.14,79,790/- WHILE FRAMING THE ASSES SMENT U/S 143(3) R.W.S. 153A OF THE ACT. ON APPEAL, BEFOR E THE LD. COMMISSIONER OF INCOME TAX (APPEALS), THE ADDITION MADE BY THE LD. ASSESSING OFFICER WAS SUSTAINED, AGAINST WHICH THE ASSESSEE IS IN FURTHER APPEAL BEFORE THIS TRIBU NAL. 2.2. IF THE OBSERVATION MADE IN THE ASSESSMENT ORD ER, LEADING TO ADDITION MADE TO THE TOTAL INCOME, CONCL USION DRAWN IN THE IMPUGNED ORDER, MATERIAL AVAILABLE ON RECORD, ASSERTIONS MADE BY THE LD. RESPECTIVE COUNSEL, IF K EPT IN JUXTAPOSITION AND ANALYZED, THERE IS NOT DISPUTE TO THE FACT THAT WHILE RECORDING THE STATEMENT, THE ASSESSEE AC CEPTED THAT HE EARNED THE INCOME RANGING FROM 0.02% TO 0.1 0%, WHEREAS, THE LD. ASSESSING OFFICER MADE AD-HOC ADDI TION AT THE RATE OF 0.50%. IN SUCH A SITUATION TO PUT AN E ND TO THE LITIGATION, CONSIDERING THE MATERIAL FACTS, I AM OF THE VIEW THAT IT WILL MEET THE END OF JUSTICE, IF THE ADDITI ON IS RESTRICTED TO 0.20%, IN PLACE OF 0.50% SUSTAINED BY THE LD. ITA NO.2867/MUM/2015 DILIP JAYANTILAL SHAH 4 COMMISSIONER OF INCOME TAX (APPEALS), THUS, THE APP EAL OF THE ASSESSEE IS PARTLY ALLOWED. FINALLY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOW ED. THIS ORDER WAS PRONOUNCED IN THE OPEN IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 14/01/2016. SD/- (JOGINDER SINGH) ! ' / JUDICIAL MEMBER MUMBAI; DATED : 15/01/2016 F{X~{T? P.S / ! & $ )!*+ ,&+-* / COPY OF THE ORDER FORWARDED TO : 1. '#$%& / THE APPELLANT 2. '(%& / THE RESPONDENT. 3. ) ) * ( '#$ ) / THE CIT, MUMBAI. 4. ) ) * / CIT(A)- , MUMBAI 5. -./ ' , ) '#$ ' 1 , / DR, ITAT, MUMBAI 6. /2 3$ / GUARD FILE. & / BY ORDER, (-# ' //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI