ITO, New Delhi V. Shri G.P. Soni, New Delhi

ITA 2951/DEL/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 53441 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2011
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 21-12-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 03-06-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SALIL MISRA
• Assessee Lawyers: K P GANGULI
• Keywords: Accommodation entries

Judgement Text

ITA NO. 2951/DEL/2011 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C, NEW DELHI BEFORE SHRI C.L. SETHI, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER I.T.A. NO. 2951/DEL/2011 A.Y. : 2003-04 INCOME TAX OFFICER, WARD 48(4), 4 TH FLOOR, ROOM NO. 424, MAYUR BHAWAN, CANNOUGHT PLACE, NEW DELHI 110 001 .. VS. SHRI G.P. SONI, J/12-B, DDA FLAT, ASHOK VIHAR-I, DELHI 110 052 (PAN/GIR NO. : ANEPS1994G) (APPELLANT ) (APPELLANT ) (APPELLANT ) (APPELLANT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) ASSEESSEE BY : SH. K.P. GANGULI, ADVOCATE DEPARTMENT BY : SH. SALIL MISRA, SR. D.R. ORDER ORDER ORDER ORDER PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) DATED 31.3.2 011 PERTAINING TO ASSESSMENT YEAR 2003-04. 2. THE GROUND RAISED READS AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED I N :- (I) REDUCING THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF COMMISSION INCOME FROM ` 10,53,436/- TO ` 1,36,947/- BY ESTIMATING THE COMMISSION INCOME @ 0.65% INSTEAD OF @5% AS ITA NO. 2951/DEL/2011 2 ADOPTED BY THE ASSESSING OFFICER NOT CONSIDERING THE FACT THAT THE ASSESSEE WAS PROVIDING ACCOMMODATION ENTRIES AND CONSIDERING THE MARKET RATE AND RISK INVOLVED. THE ASSESSING OFFICER WAS RIGHT IN ESTIMATING COMMISSION INCOME @5%. (II) THE APPELLANT CRAVES THE RIGHT TO ALTER, AMEND, ADD OR SUBSTITUTE THE GROUNDS OF APPEAL. 3. IN THIS CASE ASSESSEE HAS EXPLAINED BEFORE THE ASSESSING OFFICER THAT ASSESSEE WAS PROVIDING ACCOMMODATION ENTRIES TO PARTIES ON WHICH COMMISSION @ 0.03% WAS EARNED. ASSESSING OFF ICER OPINED THAT COMMISSION EARNED IS STATED TO BE ON VERY LOWE R SIDE. ASSESSING OFFICER OPINED THAT KEEPING IN VIEW THE RISK IN VOLVED AND THE MARKET RATE OF COMMISSION IN SUCH TYPE OF TRANSACTION NORMA LLY IT VARIES FROM 4 TO 10%. KEEPING VIEW THIS FACT THE ASSESSING OF FICER TOOK THE COMMISSION @ 5% OF THE TOTAL TRANSACTION OF ` 2,10,6 8,738/-, WHICH WORKED OUT TO ` 10,53,436/-. 4. UPON ASSESSEES APPEAL LD. COMMISSIONER OF INCOME TAX (APPEALS) CONSIDERED THE SUBMISSION AND ALSO REFERRE D TO ITAT DECISION ON THE SUBJECT. CONSIDERING THE DECIS IONS THE LD. COMMISSIONER OF INCOME TAX (APPEALS) OPINED THAT HE WOULD ESTIMATE THE COMMISSION @.65% IN THE ASSESSEES CASE. THUS, THE COMMISSION INCOME WAS CALCULATED AT ` 2,10,68,738 X .65% = 1, 36,947/-. 5. AGAINST THE ABOVE ORDER THE REVENUE IS IN APPEAL BEFORE US. 6. WE HAVE HEARD THE RIVAL CONTENTIONS IN LIGHT OF THE MATERIAL PRODUCED AND PRECEDENT RELIED UPON. ITA NO. 2951/DEL/2011 3 6.1 LD. COUNSEL OF THE ASSESSEE PLACED COUPLE OF IT AT DECISION IN WHICH CASES ITAT HAS ESTIMATED THE COMMISSION INCOME AT LOWER RATES AS COMPARED TO THAT BY ASSESSING OFFICER. WE HAVE CAREFULLY CONSIDERED THE SUBMISSION. IN OUR CONSIDERED OPINIO N, INTEREST OF JUSTICE WILL BE SERVED IF @1% COMMISSION IS ESTIMATE D AS ASSESSEES INCOME. HENCE, WE DIRECT THE ASSESSING OFFICER TO SUBSTITUTE RATE OF COMMISSION EARNING AS @1% INSTEAD OF @.65% DONE BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS). 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 21/12/2011, UPON CONCLUSION OF HEARING. SD/- SD/- [ [[ [C.L. SETHI C.L. SETHI C.L. SETHI C.L. SETHI] ]] ] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER DATE 21/12/2011 SRB COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: - -- - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES