RAKESHKUMAR M. GUPTA, MUMBAI V. ITO 14(3)(2), MUMBAI

ITA 5034/MUM/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 2912 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 1 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2007-2008
• Appeal Filed On: 01-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHANDRA VIJAY
• Keywords: Reopening of assessment; Unexplained cash credit; Rejection of books of accounts; Presumptive income; Business income; Business expenditure; Opportunity of being heard; Earning of tax free income; Additional evidence; Speculation loss; Accommodation entries; Retraction; Reassessment proceedings
• Section: 143(3); 142(1); 133A; 147; 131; 148; 2; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI B BENCH , MUMBAI BEFORE SHRI SHAILEND RA K UMAR YADAV, JUDICIAL MEMBER, AND SHRI RAJESH KUMAR , ACCOUNTANT MEMBER . ITA. NO S . 5029 TO 5036 / M UM /20 1 4 (ASSESSMENT YEAR S : 200 2 - 0 3 TO 2 0 0 9 - 10 ) RAKESHKUM AR M. GUPTA PROP. M/S. MANOJ MILLS, SHOP NO.4, RAM GALLY, PANKAJ MARKET, CHAMPA GALLY, CROSS LANE, MUMBAI 400 002 APPELLANT VS. INCOME TAX OFFICER, WARD - 14(3)(2), EARNEST HOUSE, NARIMAN POINT, MUMBAI RESPONDENT PAN: AAA JPG9761F & ITA. NO. 5037 / MUM /20 1 4 (ASSESSMENT YEAR: 20 09 - 10 ) RAKESHKUMAR M. GUPTA (HUF) PROP. M/S. SAINATH TEXTILES, 285, DHARAMRAJ GALLI, M. J. MARKET, MUMBAI 400 002 APPELLANT VS. INCOME TAX OFFICER, WARD - 14(3)(2), ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 2 EARNEST HOUSE , NARIMAN POINT, MUMBAI RESPONDENT PAN: AAAHR5485A & ITA. NO S . 5019 & 5020 / MUM /20 1 4 (ASSESSMENT YEAR S : 2008 - 09 & 20 09 - 10 ) NILESH RAKESHKUMAR GUPTA PROP. M/S. DEV VANI INDUSTRIES SHOP NO.4, RAM GALLY, PANKAJ MARKET, CHAMPA GALLY, CROSS LANE, MUMBA I 400 002 APPELLANT VS. INCOME TAX OFFICER, WARD - 14(3)(2), EARNEST HOUSE, NARIMAN POINT, MUMBAI RESPONDENT PAN: AFUPG510N & ITA. NO S . 5021 TO 5028 / MUM /20 1 4 (ASSESSMENT YEAR S : 2002 - 03 TO 20 09 - 10 ) MOHIT RAKESHKUMAR GUPTA PROP. M/S . ASTHA SILK INDUSTRIES, SHOP NO.4, RAM GALLY, PANKAJ MARKET, CHAMPA GALLY, CROSS LANE, MUMBAI 400 002 APPELLANT VS. INCOME TAX OFFICER, WARD - 14(3)(2), ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 3 EARNEST HOUSE, NARIMAN POINT, MUMBAI RESPONDENT PAN: AFUPG9014P & ITA. NO S . 5011 TO 5018 / MUM /20 1 4 (ASSESSMENT YEAR S : 2002 - 03 TO 20 09 - 10 ) SMT. HEMA R. GUPTA PROP. M/S. SHREE RAM SALES & SYNTHETICS, SHOP NO.4, RAM GALLY, PANKAJ MARKET, CHAMPA GALLY CROSS LANE, MUMBAI 400 002 APPELLANT VS. INCOME TAX OFFICER, WARD - 14(3)(2), EARNEST HOUSE, NARIMAN POINT, MUMBAI RESPONDENT PAN: AAKPG3030E / BY APPELLANT : SHRI VIMAL PUNMIYA , A.R. / BY RESPONDENT : SHRI CHANDRA VIJAY , D .R. / DATE OF HEARING : 18 . 0 8 .201 6 / DATE OF PRONOUNCEMENT : 14.09 .201 6 ORDER PER BENCH ALL THESE APPEAL S HA VE BEEN FILED BY DIFFERENT ASSESSEE S AGAINST THE RESPECTIVE ORDER S OF COMMISSIONER OF INCOME - TAX (APPEALS) - 2 5 , MUMBAI . SINCE, ALL THESE APPEALS PERTAIN TO SAME ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 4 GROUP AND ON SIMILAR ISSUE, SO THEY ARE BEING DISPOSED OF BY COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. IN ITA NO. 5 02 9 /MUM/201 4 FOR A.Y. 200 2 - 0 3, IN CASE OF RAKESHKUMAR M. GUPTA , ASSESSEE HAS FILED APPEAL ON FOLLOWING GROUNDS: 1. ADDITION OF COMMISSION OF RS.34,22,868/ - ON SALES (A) THE L D. COMMISSIONER OF INCOME TA X (APPEALS) ERRED IN FACTS AND LAW IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER OF COMPUTING THE COMMISSION 6% ON BILLING OF RS. 5,70,47,800/ - AS AGAINST 1% EARNED AND ADMITTED ON ACTUAL BILLS ACCOUNTED IN THE BOOKS AND NOT CONSIDERING THE TOTAL DEPOS ITS IN BANK THAT SUBSTANTIATE THE BILLING ACCOUNTED FOR IN THE BOOKS OF ACCOUNT. (B) THE L D. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN FACTS AND LAW IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER OF CALCULATING THE COMMISSION 6% AS AGAINST 1% ADMIT TED DURING THE COURSE OF SURVEY PROCEEDINGS, MERELY BASED ON SURMISES AND CONJECTURES AND WITHOUT BRINGING ON RECORD ANY MATERIAL TO SHOW THAT THE APPELLANT HAD INFACT EARNED SUCH A COMMISSION AT ALLEGED HIGHER RATE OF 6%. (C) THE L D. COMMISSIONER OF INCO ME TAX (APPEALS) ERRED IN FACTS AND LAW IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER ASSUMING THE BASE OF BILLING AT RS.5,70,47,800/ - AGAINST BILLING OF RS.5,52,51,947/ - RECORDED IN THE BOOKS OF ACCOUNTS AND IN NOT MAKING ANY REFERENCE TO BANK BOOK AN D STATEMENTS IMPOUNDED DURING THE COURSE OF SURVEY. 2. YOUR APPELLANT PRAYS THAT (A) ADDITION OF RS.34,22,868 / - AS COMMISSION ON SALES AT 6% BE DELETED; ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 5 (B) ANY OTHER RE LIEF, AS MAY BE DEEMED FIT IN THE MATTER, BE GRANTED. 2.1 IN ITA NO.5029/MUM/2014 FOR A.Y. 2002 - 03, IN CASE OF SAME RAKESHKUMAR M. GUPTA, ASSESSEE HAS RAISED FOLLOWING ADDITIONAL GROUNDS: 5. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN CONSIDERING THAT APPELLANT IS IN BUSINESS OF GIVING ACCOMMODATION ENTRY INSTEAD OF GENUINE BUSINESS. 6. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN CONFIRMING THE REJECTION OF BOOKS OF ACCOUNT U/S.145. 7. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN A LLOWING THE DEDUCTION OF EXPENSES ON AD - HOC BASIS INSTEAD OF ACTUAL BASIS CLAIMED BY THE APPELLANT. 8. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN NOT ALLOWING THE DEDUCTION OF REBATE U/S 88 CLAIMED BY THE APPELLANT IN R ETURN OF INCOME. 3 . ASSESSMENT IN THIS CASE WAS ORIGINALLY COMPLETED U/S.143(3) OF THE ACT ON 29.03.2005 DETERMINING TOTAL INCOME AT RS.2,05,080/ - AS AGAINST THE RETURNED INCOME OF RS.1,93,070/ - . SUBSEQUENTLY, IT WAS REVEALED DURING SURVEY ACTION U/S.13 3A OF THE ACT CONDUCTED AT ASSESSEE'S PREMISES ON 13/ 14.02. 2009 THAT ASSESSEE HAD EARNED ON BUSINESS OF ISSUING HAWALA BILLS FOR SALES ON COMMISSION BASIS. HENCE , THE CASE OF ASSESSEE WAS REOPENED BY ISSU ING NOTICE U/ S 148 OF THE ACT DATED 18.03.200 9 AND OTHER STATUTORY NOTICES U/ S . 142(1) ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 6 FROM TIME TO TIME, WHICH WERE DULY SERVED ON THE ASSESSE E . DURING REASSESSMENT PROCEEDINGS, ASSESSING OFFICER OBSERVED THAT ASSESSEE HAD NOT CARRIED OUT ANY TRADING BUSINESS OF TEXTILES, AND WAS ONLY ENGA GED IN THE ACTIV ITY OF ISSUING SALES B ILLS (ACCOMMODATION BILLS). CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE, BOOK S OF ACCOUNTS OF ASSESSEE WERE REJECTED AND ASSESSMENT WAS COMPLETED ON BEST JUDGMENT WORKING OUT THE NET COMMISSION INCOME AT RS.32,51,725/ - . THE AP PEAL OF ASSESSEE AGAINST SAID ORDER WAS DISMISSED BY CIT(A) VIDE ORDER DATED 18.11.2011 . ON F U RTHER APPEAL, THE ITAT, MUMBAI VIDE ORDER DATED 14.08.20 1 3 SET ASIDE THE MATTER TO THE RECORD OF CIT(A) WITH A DIRECTION TO ASSESSEE TO APPEAR BEFORE THE CIT(A), AND THE CIT(A) WAS EXPECTED TO GIVE A FAIR HEARING TO THE ASSESSEE TO PRESENT HI S CASE. ACCORDINGLY, THIS APPEAL IS INSTITUTED AS PER THE SAID ORDER OF ITAT. 4. ACCORDINGLY, ASSESSEE BEFORE CIT(A) FILED WRITTEN SUBMISSIONS , WHEREIN CIT(A) OBSERVED THAT I N THE ORIGINAL APPEAL FILED BY ASSESSEE, ASSESSEE HAD RAISED SEVERAL GROUNDS, EFFECTIVELY ONLY TWO POINTS FOR DETERMINATION OF APPEAL I.E. (I) REOPENING OF ASSESSMENT U/S . 147, (II) DETERMINATION / ESTIMATION OF COMMISSION INCOME OF RS.32,51,725/ - U/S. 14 4 R.W.S. 148 AND 145 OF THE ACT. THE FIRST APPEAL OF ASSESSEE WAS DISMISSED BY CIT(A) ON BOTH THESE POINTS. IN SECOND ROUND, DURING APPELLATE PROCEEDINGS, ASSESSEE HAS CHOSEN NOT TO PRESS POINT NO. 1 REGARDING REOPENING OF ASSESSMENT U/S . 147 OF THE ACT . SO, IN SECOND ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 7 ROUND, NOW EFFECTIVE ISSUE BEFORE CIT(A) REMAINS ONLY ONE POINT FOR DETERMINATION OF APPEAL I.E. THE DETERMINATION/ ESTIMATION OF COMMISSION INCOME OF RS.32,51,725/ - AS 144 R.W.S. 148 AND 145 OF THE ACT. 4 . 1 ASSESSING OFFICER IN HIS ORDER U/S . 144 R.W.S. 148 AND 145 OF THE ACT HAS DISCUSSED THE FACTS A N D CIRCUMSTANCES OF THE CASE IN DETAIL, AND NOTED HIS FINDINGS IN PARA 27 OF THE ASSESSMENT ORDER, WHICH IS REPRODUCED AS UNDER: 27. THE DISCUSSION MADE IN THE PRECEDING PARAS ESTABLISHES THE F OLLOWING FACTS: (I) ASSESSEE HAS NOT CARRIED OUT ANY TRADING BUSINESS IN TEXTILES (II) ASSESSEE HAS ONLY BEEN ENGAGED IN THE ACTIVITY OF ISSUING SALES BILLS (ACCOMMODATION BILLS) WHOEVER APPROACHES HIM. (III) FOR RECORD PURPOSE, ASSESSEE HIMSELF PREPARE D PURCHASE BILLS BY USING THE BILLS BOOKS GOT PRINTED AND KEPT WITH HIM FROM YEAR TO YEAR OR GET GENERATED FROM HIS COMPUTER. (IV) ASSESSEE HAS OPERATED SEVERAL BANK ACCOUNTS AND SALE PROCEEDS RECEIVED ARE DEPOSITED AND WITHDRAWN IN CASH AND CASH IS GIVEN TO THE SALE P ARTIES AFTER DEDUCTING ASSESSEE 'S COMMISSION. THE DEDUCTION OF COMMISSION IS OVER AND ABOVE SHOWN IN THE BOOKS AS G.P. THIS WAS NEVER DISCLOSED IN THE BOOKS. (V) ASSESSEE HAS FLOATED NUMBER OF CONCERNS, FOR PREPARING PURCHASE BILLS, OPERATE D SEVERAL BANK ACCOUNTS AND AMOUNT PAID TO THESE ACCOUNTS IN THE GUISE OF PURCHASE CONSIDERATION. FROM THESE ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 8 ACCOUNT CASH IS WITHDRAWN AND PAID TO THE SO CALLED CUSTOMERS AND RETAINED COMMISSION THERE ALSO. (VI) ASSESSEE HAS ALSO CATEGORICALLY STATED IN H IS STATEMENT RECORDED U/S. 131 ON 23.2.2009 THAT HE HAS NOT PAID ANY BROKERAGE OR COMMISSION AS ALL PURCHASE BILLS ARE MADE BY HIM. (VII) FROM THE STATEMENT/DOCUMENTS FOUND DURING THE COURSE OF SURVEY ACTION AND IMPOUNDED, THAT COMMISSION EARNED VARIES FR OM 2 TO 4% AND ASSESSEE HAS ACCOUNTED ONLY 1.15% IN THE FORM OF G.P. IN THE ACCOUNTS FURNISHED WITH THE RETURN. HOWEVER, THE COMMISSION EARNED IN CASH WHILE HANDING OVER THE MONEY TO CUSTOMERS; COMMISSION CHARGED ON BACK DATED BILLS AND IN FICTITIOUS SUPPL IER'S ACCOUNT DISCUSSED ABOVE WERE NEVER ACCOUNT E D, (VIII) ASSESSEE HAS NOT FURNISHED ANY DETAILS AND DO CUMENTARY EVIDENCE DURING THE COURSE OF PRESENT REASSESSMENT PROCEEDINGS TO PROVE THE CONTENTIONS MADE IN LETTERS AND AFFIDAVIT AS DISCUSSED ABOVE THAT HIS BUSINESS IS THAT OF PURCHASING GOODS FROM VARIOUS PARTIES IN MUM B AI WHO ARE CARRYING OUT THEIR MANUFACTURING OF MANMADE FABRICS ACTIVITIES ON POWER LOOMS IN AND AROUND BHIWANDI. (IX) ASSESSEE HAS NOT FURNISHED DETAILS AND PROVED THAT THE DEBITS MADE IN THE FORM OF PURCHASES, STOCK, EXPENSES AND CREDITS - SALES, CLOSING STOCK ARE GENUINE BUSINESS TRANSACTIONS WITH DOCUMENTARY EVIDENCES. IT IS ON RECORD THAT NOTHING HAS BEEN FURNISHED INSPITE OF GIVING NUMBER OF OPPORTUNITIES. (X) THE DETAILS FURNISHED AND ACCEPTED DURING THE COURSE OF ORIGINAL ASSESSMENT MADE ON 29.3.2005 CANNOT BE ACCEPTED AS CORRECT, GENUINE AND AUTHENTICABLE. IN VIEW OF THE FACTS FOUND AND ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 9 ADMITTED BY ASSESSEE AS DETAILED ABOVE THAT ASSESSEE IS ENGAGED IN ISSUING OF SALES BILLS / HA WALA BILLS/ACCOMMODATION BILLS AND PURCHASE BILLS ARE ALSO PREPARED/PRINTED BY ASSESSEE AND THE ACTIVITY IS BEING CARRIED OUT ON FROM THE YEAR 2000 ONWARDS. (XI) MERE DENIAL IN LETTERS D T . 6.4.2009, 27.4.2009, 24 / 29.9.2009 AND IN LETTER D T . 3.11.2009 AN D IN AFFIDAVIT OF 5.11.2009 OF FACTS FOUND, ADMITTED AND RECORDED DURING T HE COURSE OF SURVEY ACTION U/S. 133A AND IN STATEMENT U/S. 131 ON 23.2.2009 DO NOT AMOUNT TO PROVING THAT ASSESSEE IS CARRYING ON BUSINESS IN TEXTILES. (XII) ACTION U/S. 133A AT ASSES SEES PREMISES WERE LEGALLY AND PROPERLY CARRIED OUT. HENCE, ASSESSEE IS BOUND BY THE FINDING AND ADMISSION MADE IN STATEM ENT AND REAFFIRMED ON OATH U/S. 131 AS DISCUSSED ABOVE. (XIII) ASSESSEE HAS NOT PROVED THE G ENUINENESS OF DEBITS IN P & L A/ C. SUCH AS OPENING STOCK, PURCHASES AND VARIOUS EXPENSES AND CREDITS SUCH AS SALES, CLOSING STOCK WITH VERIFIABLE DOCUMENTS AND DETAILS DURING THE PRESENT ASSESSMENT PROCEEDINGS THOUGH OPPORTUNITIES FOR THE SAME WERE GIVEN AS PER VARIOUS NOTICES DISCUSSED ABOVE. (XI V) THE LETTERS FURNISHED ON 29.9.2009 HAVE NO ENCLOSURES AND APPEAR MERE COPIES OF LETTERS FURNISHED DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS WHICH CANNOT BE RELIED UPON IN VIEW OF TRUE FACTS OF ACTIVITIES OF ASSESSEE UNEARTHED DURING THE COURS E OF SURVEY ON 13/ 14.2.2009 AND CONFIRMED IN THE STATEMENT U/S. 131 ON 22.2.2009. (XV) THE HUGE CASH BALANCE AS PER BOOKS AND NO ACTUAL CASH FOUND DURING THE SURVEY ALSO GOES TO PROVE THAT CASH WITHDRAWN IS GIVEN TO SALES ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 10 PARTIES AFTER DEDUCTING COMMISSIO N WHICH HAS BEEN R EAFFIRMED IN THE STATEMENT U/S. 131 D T . 23.2.2009. (XVI) IT IS SEEN FROM THE IMPOUNDED DOCUMENTS/BILLS THAT SALES BILLS ISSUED ARE TO THE EXTENT OF RS. 5,70,47,800 / - AS SHOW CAUSED IN THE NOTICE/LETTER D T .12.6.2009. (XVII) IN VIEW OF THE FACTS UNEARTHED DURING THE COURSE OF SURVEY AND CONFIRMED ON 23.3.2009, MERE FILING OF COPIES OF OLD CONFIRMATION OF 2002 FURNISHED AT THE TIME OF ORIGINAL ASSESSMENT CANNOT BE TREATED AS PROVING OF PURCHASES AND SALES SHOWN IN THE ACCOUNTS SUBMITTED AND AS COMPLIANCE TO VARIOUS NOTICES U/S. 142(1) AND LETTERS TO THE ASSESSEE. (XVIII) WHEN THE ASSESSING OFFICER ISSUED NOTICES U/S. 142(1), ASKED ASSESSEE TO PROVE HIS CLAIMS, IF ANY, WITH VERIFIABLE DETAILS AND SUPPORTING DOCUMENTS FOR EACH DEBIT AND CREDIT, MERE DENIAL OF FACTS FOUND DURING THE SURVEY BY AN AFFIDAVIT AND FILING SOME LEDGER - ACCOUNT CO MPUTER SHEETS OF SOME PARTIES ( MOST OF THEM ARE UNSIGNED) THROUGH AN AFFIDAVIT CANNOT BE TREATED AS A COMPLIANCE TO THE NOTICE U/S.142(1). (XIX) THE VALIDITY A ND CORRECTNESS OF OLD CONFIRMATION IS 'ZERO' ON ACCOUNT OF FACTS NOTICED AND ADMITTED DURING THE COURSE OF SURVEY AND THE QUESTION OF VERIFICATION ARISES ONLY WHEN ASSESSEE FURNISH FRESH EVIDENCES/CONFIRMATIONS AND DETAILS. (XX) THE ASSESSEE HAS HIMSELF A DMITTED THAT ALL CREDITORS IN BALANCE SHEET ARE BOGUS AND FILED COMPLETE LIST THEREOF (XXI) IT IS SEEN DURING THE COURSE OF SURVEY THAT ASSESSEE MADE CASH LOAN TO THE EXTENT OF RS. 1.40 CRORES FOR WHICH ASSESSEE OBTAINED CHEQUES AS SECURITY. THIS FACT REV EALS THAT ASSESSEE IS ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 11 RETAINING CASH COMMISSION WHILE AMOUNT IS WITHDRAWN AND HANDED OVER TO THE SO CALLED CUSTOMERS IN ADDITION TO (I) PROFIT GENERATED IN M / S. MANOJ MILLS (DIFFERENCE BETWEEN THE SO CALLED PURCHASES AND SO CALLED SALES) (II) PROFIT EARNED IN NUMBER OF FICTITIOUS PROPRIETORY CONCERNS, AS DISCUSSED ABOVE. THIS ALSO SHOWS THAT ASSESSEE EARNED INCOME IN THREE PLACES VIZ. (I) IN PROPRIETORY CONCERN M / S. MANOJ MILLS, DECLARED IN THE RETURN (II) COMMISSION RETAINED WHILE CASH IS GIVEN TO SO CALL E D CUSTO MERS AND ( III) PROFIT EARNED IN FICTITIOUS PROPRIETORY CONCERNS DISCUSSED ABOVE. (XXII) IN THE LETTER DT. 6.4.2009, ASSESSEE MADE STATEMENTS THAT HE PURCHASES FROM BHIWANDI PARTIES AND PAYMENTS ARE EITHER THROUGH DISCOUNTED CHEQUES OR CASH. DURING THE COURSE OF ASSESSMENT PROCEEDINGS ASSESSEE HAS NOT FURNISHED ANY DETAILS OF PURCHASES. AS PER INFORMATION AVAILABLE IN IMPOUNDED BOOKS AND DOCUMENTS, THE SO CALLED PURCHASES ARE OF FICTITIOUS PROPRIETORY CONCERNS OF ASSESSEE AND FAMILY MEMBERS DISCUSSED ABOVE AND OTHER PAPER CONCERNS CREATED IN MUMBAI ADDRESS AND NOT OF BHIWANDI. HENCE, THE STATEMENT IS MADE TO FIND EXCUSES IN NOT GIVING ANY DETAILS OF PURCHASES WHEN CALLED UPON TO PROVE PURCHASES BY ISSUING NOTICE U/S. 142(1) ON VARIOUS OCCASIONS. (XXI II) ASSESSEE HAS MADE SUBSTANTIAL INVESTMENTS IN IMMOVABLE PROPERTIES. IF ASSESSEE CLAIMS THAT HIS COMMISSION IS ONLY 1%, HOW HE CAN MAKE SUCH HUGE INVESTMENTS. THIS FACT ALSO GOES TO SHOW THAT ASSCSSE E 'S COMMISSION IS MUC H MORE THAN THE SO CALLED 1%.' 4. 2 BASED ON ABOVE FINDINGS, ASSESSING OFFICER REJECTED THE BOOK RESULTS OF ASSESSEE, AND ASSESSEE'S TOTAL COMMISSION INCOME FROM (I) ACCOMMODATION BILLS ISSUED IN THE NAME OF ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 12 PROPRIETARY CONCERN M /S . MANOJ MILLS, & (II) COMMISSION EARNED IN CASH AS DISCUSSE D AND COMMISSION EARNED IN FICTITIOUS CONCERNS WAS ESTIMATED AT 6%, AS AGAINST 4% AND 3% AGGREGATING TO 7% PROPOSED IN SHOW CAUSE NOTICE DATED 12.06.2009 AND 23.10.2009. SUCH ESTIMATED COMMISSION ON GROSS SALES BILLS ISSUED OF RS.5,70,47,800/ - WAS WORKED O UT TO RS.34,22,868/ - OUT OF SAID ESTIMATED INCOME, EXPENSES WAS ALLOWED @ 5% OF ESTIMATED COMMISSION INCOME I.E. AT RS.1,71,143/ - ACCORDINGLY, COMMISSION INCOME WAS ESTIMATED AT RS . 34,22,868 - 1,71,143 = RS.32,51,725/ - . 4 . 3 DURING PREVIOUS APPELLATE PROCE EDINGS , ASSESSEE HAD QUESTIONED THE ESTIMATES OF ASSESSING OFFICER ON T W O COUNTS, (I) ESTIMATION OF TURNOVER AT RS.5,70,47,800 / - BY ASSESSING OFFICER BASED ON SALE BILLS FOUND DURING SURVEY, AS AGAINST TURNOVER OF RS.5,52,51,947/ - DECLARED BY THE ASSESSEE ; (II) RATE OF ESTIMATION OF GROSS COMMISSION @7% BY TAKING 4% ON GIVING SALES BILLS AND 3% ON PURCHASE BILLS, THOUGH ASSESSING OFFICER HAD FINALLY ASSESSED SUCH GROSS COMMISSION @ 6% AS AGAINST 7% PROPOSED IN SHOW CAUSE NOTICE. THE ASSESSING OFFICER, HOW EVER , CLARIFIED HIS BASIS OF RATE OF ESTIMATION BY WAY OF A REMAND REPORT. ASSESSING OFFICER STATED THAT IT WAS ON THE BASIS OF MARKET INFORMATION, THE STATEMENT ON OATH OF ASSESSEE AND HIS PRELIMINARY VERBAL CONFESSIONS COMBINED WITH OTHER FACTORS AND I NFORMATION WHICH WAS IN POSSESSION OF THEN ASSESSING OFFICER , THAT A FAIR RATE OF COMMISSION @7% WAS DECIDED TO BE ADOPTED. ASSESSING OFFICER ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 13 OBSERVED THAT NEITHER THE DEPARTMENT NOR THE ASSESSEE C OULD ACTUALLY SUPPORT THESE CLAIMS OBJECTIVELY ON THE BASI S OF ANY DOCUMENTS, AND THEREFORE THE THEN ASSESSING OFFICER ACTED BONAFIDELY ON THE BASIS OF BEST OF HER JUDGMENT FORMED UPON THE RELIABLE MARKET INFORMATION AND ADOPTED THE RATE OF COMMISSION CHARGED BY ASSESSEE @7% WHICH WAS QUITE FAIR AND JUSTIFIED. TH E PREDECESSOR S OF CIT(A) AFTER CONSIDERING THE ARGUMENTS OF ASSESSEE AS WELL THE ASSESSING OFFICER , AND ALSO THE RATES OF PRESUMPTIVE TAXATION UNDER VARIOUS STATUTORY PROVISIONS, WAS OF THE VIEW THAT THE RATE OF 6% FOR ESTIMATION OF INCOME TAKEN BY THE ASS ESSING OFFICER MATCHED WITH THE PRESUMPTIVE RATE OF INCOME AS STIPULATED BY THE STATUTE ITSELF UNDER VARIOUS PROVISIONS OF THE ACT. HENCE , HE FOUND THE ACTION OF ASSESSING OFFICER IN ACCORDANCE WITH THE STATUTORY PROVISIONS AS WELL AS PECULIAR AND DUBIOUS FACTS OF THE INSTANT CASE, AND ACCORDINGLY THE GROUNDS OF APPEAL RELATING TO THE ISSUE WERE REJECTED. 4 . 4 AS PER DIRECTIONS OF ITAT, ASSESSEE WAS PROVIDED OPPORTUNITY TO APPEAR AND PRESENT ITS CASE. ACCORDINGLY, ASSESSEE APPEARED ON 19.03.2014 AND FILED WRITTEN SUBMISSIONS, ALONG WITH PAPER BOOK CONTAINING COPY OF ITAT ORDER DATED 14.08.2013, COPY OF ASSESSMENT ORDER, COPY OF ACKNOWLEDGEMENT OF RETURN OF INCOME, COPY OF FINANCIAL STATEMENT WITH TAX AUDIT REPORT, STATEMENT RECORDED U/S . 133A OF THE ACT DA TED 13.02.2009 AND STATEMENT RECORDED U/S . 131 OF THE ACT DATED 23 . 02.2009. THE WRITTEN SUBMISSIONS MADE BY ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 14 ASSESSEE ARE REPRODUCED BELOW: AT THE OUTSET, IT COULD BE WORTHWHILE TO STATE THE CHRONOLOGY OF EVENTS RESULTING INTO REMAND OF THE PRESENT APPEA L BY THE HBLE ITAT. 1. THE ASSESSMENT YEAR INVOLVED IN THE PRESENT CASE IS AY 2002 - 03. 2. THE AO PASSED THE ORDER DATED 13 - 11 - 2009 U/S 147 / 144 RWS 148 AND 145 OF THE IT ACT ASSESSING THE TOTAL INCOME AT RS. 34,88,620 / - AS AGAINST THE ORIGINALLY ASSESSED U/S 143(3) INCOME AT RS. 2,05,080/ - 3. THE CIT (APPEALS) - 25 VIDE ORDER DATED 18 - 11 - 2011 DISMISSED THE ASSESSEE 'S APPEAL. 4. THE H'BLE ITAT ' H ' BENCH MUMBAI VIDE ORDER DATED 14 - 08 - 2013 SET ASIDE THE MAT T ER TO THE RECORD OF YOUR HONOUR [CIT (A)] WITH THE DIRECTIONS AS GIVEN BY THE TRIBUNAL IN THE CASE OF ASSESSEE 'S WIFE SMT. HEM A R. GUPTA. (COPY OF THE ITA T ORDER IS ENCLOSED HEREWITH AS PAGE NO . 08 TO 11 OF THE PAPER BOOK.) ATTENTIONS IS INVITED TO PAGE 3 PARA 3 OF THE SAID ITAT ORDER WHICH STATES AS U NDER: '3.. WE HAVE CAREFULLY PERUSED THE ORDER OF THE LD. CI T(A) AND THE COPIES OF THE LETTER FILED BY THE ASSESSEE BEARING STAMP OF THE LD. CIT (A). WE FIND THAT THE ASSESSEE DID REQUEST THE LD. CI T(A) TO POST THE CASE FOR HEARING AFTER 14 TH NOVEMBER, 20 11. A PERUSAL OF THE ORDER OF THE CIT(A) SHOWS THAT THE CASE WAS FIXED ON 16TH NOVEMBER, 2011. THEREAFTER, THE LD. CIT (A) PROCEEDED TO DECIDE THE APPEAL EXPARTE RELYING UPON THE OWN ORDER IN THE CASE OF ASSESSEE 'S HUSBAND. THE LEARNED COUNSEL OF THE ASSE SSEE 'S PRAYED BEFORE US THAT IF GIVEN AN OPPORTUNITY, THE ASSESSEE WILL REPRESENT ITS CASE BEFORE THE LD. CIT (A) WITHOUT SEEKING ANY FURTHER ADJOURNMENT. IN OUR HUMBLE OPINION, THE ISSUES DESERVES TO BE RESTORED BACK TO THE FILE OF THE LD. CIT (A). THE A SSESSEE IS DIRECTED TO APPEAR BEFORE THE ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 15 LD. CIT (A) ON 4TH JULY, 2013. THE LD. CIT (A) IS EX PECTED TO GIVE FAIR HEARING TO THE ASSESSEE TO PRESENT ITS CASE.' 4.5 IN THIS 'SET ASIDE' PROCEEDING , IT WAS SUBMITTED ON BEHALF OF ASSESSEE AS UNDER: 2.1 AT TH E OUTSET, IT IS SUBMITTED THAT I DO NOT WISH TO PRESS POINT NO 1 REGARDING REOPENING OF THE ASSESSMENT U/S 147 AND REQUEST YOUR HONOUR TO KINDLY DECIDE THIS POINT ACCORDINGLY. 2.2 AS REGARDS POINT NO 2 ABOUT DETERMINATION / ESTIMATION OF INCO ME, I WISH TO H IGHLIGHT THE FUN DAME N TALS, CRUCIAL AND IMPORTANT ISSUES BEFORE YOUR HONOUR, EVEN THOUGH THE LD. A. O . AND LD. CIT (A) (YOUR PREDECESSOR) HAS EXHAUSTIVELY NARRATED SEVERAL ISSUES IN THAT REGARD. MY HUMBLE SUBMISSION IS CONTAINED IN THE FOLLOWING PARAS: 3. I N ORDER TO AVOID REPETITION OF T HE ENTIRE 'WRITE UP' [PAGES 12 TO 25 OF THE CIT(A) ORDER], I AM NOT NARRATING THE ENTIRE SCENARIO, BUT AT THE SAME TIME, WITHOUT GOING INTO LEGALITY, STATING THE CRUCIAL FACTS FOR YOUR HONOUR'S KIND CONSIDERATION. 3.1 I AM AN INDIVIDUAL AND HAS FURNISHED THE RETURN OF INCOME DECLARING THE TOTAL INCOME OF RS. 1,93,070/ - . THE ASSESSMENT WAS O RIGIN A LLY COM P LETED U/S 143 (3) AT RS. 2,05,080 / - . BASED ON THE SUBSEQUENT SURVEY ACTION U/S 133A ON 13 - 02 - 2009, THE ASSESSMENT WAS REOP ENED AND THE INCOME WAS DETERMINED/ESTIMATED AT RS. 34,88,620/ - . I AM AGGRIEVED ON THIS DETERMINATION /ESTIMATION OF INCOME. MY HUMBLE SUBMISSION IS THAT THE INCOME SO DETERMINED IS FAR FROM REALITY AND THEREFORE INCORRECT. BEFORE CANVASSING THE REALISTIC FACTS, IT WOULD BE APPROPRIATE TO MENTION AS TO HOW THE SAID INCOME HAS BEEN DETERMINED. PARTICULARS RATE APPLIED (%) AMOUNT (RS.) TURNOVER ASSESSED RS. 6% 34,22,868/ - ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 16 5,70,47,800/ - LESS: EXPENSES 5% OF 34,22,868/ - (1,71,143/ - ) BUSINESS INCOME DETERMIN ED 32,51,725/ - ADD: INCOME FROM OTHER SOURCES UNDISPUTED 2,43,299/ - * LESS: DEDUCTION UNDER CHAPTER VIA (6,396/ - ) TAXABLE INCOME 34,88,617/ - *TREATED AS BUSINESS INCOME IN THE RETURN OF INCOME 3.2 THE A. O'S APPLICATION OF 6% IS TOTALLY INCORRECT IN VIEW OF THE FOLLOWING FACTS, WHICH ARE SPECIFICALLY AGREED UPON/CONFESSED BY THE LD. A.O IN PARA 27 OF THE ASSESSMENT ORDER. [YOUR HONOUR IS REQUESTED TO REFER FIRST 3 LINES OF THE PAGE 14 OF THE CIT (A) ORDER] ( I) 27 ( I ) ASSESSEE HAS NOT CARRIED OUT ANY TRADING BUSINESS IN TEXTILES. (II) 27 (II) FOR RECORD PURPOSE, ASSESSEE HIMSELF PREPARED PURCHASE BILLS BY USING THE BILL BOOK GOT PRINTED AND KEPT WITH HIM FROM YEAR TO YEAR OR GET GENERATED FROM THE COMPUTER. [P AGE 14 OF ORDER OF CIT (APPEAL) ORDER] (III ) QUESTION NO 10 - WHAT IS THE PERCENTAGE OF COMMISSION RECEIVED BY YOU AND FROM WHOM: ANS - I AM RECEIVING 1% CO MM ISSIO N ON THE GROSS AMOUNT OF SALES BILL FROM THE SALES PARTIES . (PAGE 25 - BOTTOM PARA OF THE A O 'S ORDER) (PAGE 36. OF THE PAPER BOOK) (IV) '4. THAT MEANS YOU AND YOUR FAMILY CONCERN DID NOT HAVE ANY 'TRADING' ACTIVITIES FROM THE YEAR 2000 ONWARDS...... [PAGE 2 OF POINT NO 4 OF THE STATEMENT RECORDED ON 23 - 2 - 2009] (PAGE 94. OF THE PAPER BOOK) (V) '7. HOW DO YOU GENERATE INCOME FROM THESE ACCOMMOD ATION BILLS . ANS: I RECEIVE 1% COMMISSION ON THE GROSS AMOUNT OF SALES BILLS FROM THE PARTIES, WHICH I AM OFFERING FOR TAXATION EVERY YEAR AFTER DEDUCTING NOMINAL EXPENSES.' PAGE 2 OF POINT NO 4 OF THE STATEMENT R ECO RDED ON 23 - 2 - 2009] (PAGE 94. OF THE PAPE R BOOK) (VI) ' 44 ......HOWEVER, ON PHYSICAL VERIFICATION THE TOTAL CASH IN ALL THE ABOVE CONCERNS FOUNDS AT THE 702, AKHIL ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 17 TOWERS, DAHISAR EAST AMOUNTING TO RS. 79000/ - AND AT THE PREMISES OF THE SHOP NO 4, PANKAJ MARKET, CHAMPA GALLI CROSS LANE, MUMBAI - 2 AMOUNTING TO RS. 1,60,000/ - ... [PAGE 14 OF POINT NO 44 OF THE STATEMENT RECORDED ON 13 - 2 - 2009] (PAGE 90. OF THE PAPER BOOK) (VII) IT IS SEEN FROM THE IMPOUNDED DOCUMENTS/BILLS THAT THE SALES BILLS ISSUED ARE TO THE EXTENT OF RS. 5, 70, 47,800 AS SHO W CAUSED NOTICE/LETTER DATED 12 - 6 - 2009. [PARA XVI ON PAGE 37 OF THE ASSESMNET ORDEER]. (PAGE 48 OF THE PAPER BOOK) IT MEANS THE AO HIMSELF HAS AGREED THAT THERE WAS NO ACTUAL BUSINESS BUT THE SAID AMOUNT REPRESENTS ONLY ACCOMMODATION BILLS. 3.4. THE A. O. ' S ESTIMATION OF 6% (PROPOSED 7% BASED ON COMMISSION OF 4% ON SALES AND 3% ON PURCHASES) IS ALSO FACTUALLY INCORRECT SINCE COMMISSION IS EARNED ON ISSUING ACCOMMODATION BILLS ON SALES NOT ON OBTAINING PURCHASES BILLS . IF THE PRINCIPAL OF EARNING COMMISSION ON ISSUING SALES BILLS IS APPLIED, THE EXPENSES @ 3% SHOULD HAVE BEEN CONSIDERED FOR OBTAINING PURCHASES BILLS BY THE ASSESSEE. THEREFORE, THE ASSESSE E 'S CONTENTION OF EARNING 1% COMMISSION ON SALES BILLS HOLD GOOD ON THIS COUNT ALSO (I.E 1% =4% EARNED ON SALES - 3% EXPENDED ON PURCHASES). 3.5 IT IS HU MBL Y SUBMITTED THAT FINALLY THE DISPUTE BETWEEN THE A. O . AND THE ASSESSEE IS BROADLY ON TWO POINTS I.E (1 ) ESTIMATING THE TURNOVER AND ( II ) ESTIMATING THE GROSS PROFIT RATE ON ISSUING HAWALA BILLS. 3.6 THE T URNOVER ASSESSED BY THE A. 0. IS RS.5, 70,47,800 AS AGAINST THE AUDITED TURNOVER OF RS.5,51,51,947. THE A O HAS STATED NOTHING IN THE ORDER AS TO NOW HE HAS W ORKED OUT THE SAID FIGURE EXCEPT THAT THE BILLS OF THE SAID AMOUNTS WERE FOUND DURING SURVEY. IT IS SUBMITTED THAT THERE IS NOTHING ON RECORDS THAT THE BILLS SO FOUND WERE ACTUALLY HAS BEEN USED BY OTHER ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 18 PARTIES OR PAYMENTS HAVE BEEN RECEIVED. THUS, THE TURNOVER CANNOT JUST BE ASSESSED ON SUSPICIOUS AND ON IMAGINARY FIGURES WITHOUT ACTING JUDICIOUSL Y. 3.7 IN VIEW OF THE ABOVE SUBMISSION, YOUR HONOUR WILL KINDLY APPRECIATE THAT A PERSON LIKE RUE, HAVING DISCLOSED THE TRUTH ABOUT PROVIDING THE ACCOMMODATION BILLS, WHICH FACTS HAS BY AND LARGE BEEN ACCEPTED BY THE A.O. AS WELL, CANNOT EARN THE UNREALIS TIC INCOME OF RS.34 LACS ASSESSED BY THE A.O. THE VARIOUS QUESTIONS AND ANSWERS QUOTED HEREIN ABOVE ALSO INDICATE THAT I WAS EARNING ONLY 1% COMMISSION ON THE AMOUNT OF ACCOMMODATION BILLS. 4. IF THE BASIS AS DISCUSSED ABOVE IS APPLIED, MY BUSINESS INCOM E WOULD BE COMPUTED UNDER: 1% OF ACCOMMODATION BILLS OF RS. 5,52,51947 = RS. 5,52,619/ - LESS : BANK INTEREST (INDISPUTABLY FOR ABOVE ACTIVITIES) (RS. 1,54,655/ - ) LESS : 5% OF TOTAL COMMISSION ALLOWED BY A0 (RS. 27,626 / - ) ------------------- BUSINESS INCOME RS. 3,70,3381 - 5. IT IS THEREFORE, REQUESTED TO KINDLY CONSIDER THE ABOVE FACTS IN TOTALITY AND ADDITIONAL FACTS THAT THE CASH FOUND IN MY ALL PREMISES COMBINED WAS ONLY RS. 2,39,000/ - (OF ALL FAMILY MEMBERS) AND ASSESS THE AMOUNT WHICH IS REALISTIC AND JUSTIFIA B LE AS STATED/COMPUTED ABOVE. 6. ONE MORE ISSUE I WISH TO URGE BEFORE YOUR HONOUR IS ABOUT NOT ALLOWING REBATE U/S 88 BY AO OF LIC PREMIUM AND PPF AMOUNTING TO RS. 47,7681 - . THE REBATE @ 20% COMES TO RS. 9,5541 - WHICH WAS CLAIMED IN THE RETURN OF INCOME. IT APPEARS THAT THE A0 HAS FORGOTTEN TO GRANT SUCH REBATE WHILE MAKING THE TAX WORKING. I AM MAKING TH E NEC ES SARY APPLICATION BEFORE THE A. O . YOUR HONOUR'S DIRECTION IN THIS REGARD WILL HELP ME GETTING JUSTICE ON THIS ISSUE AS WELL . 7. I AM CONFIDENT THAT YOUR HONOUR WILL ACCEDE TO MY ABOVE REQUESTS WHICH ARE PURELY ON FACTS. IN CASE YOUR HONOUR FEELS OTHERWISE OR ANY NEED FOR SUPPORT OF JUDICIAL PRONOUNCEMENTS, I WILL BE MOST HAPPY TO SUBMIT THE ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 19 SAME ON HEARING FROM YOUR HONOUR. 4.6 A REMAND REPORT WAS ALSO CALLED FROM THE ASSESSING OFFICER AND HE SUBMITTED HIS REMAND REPORT DATED 30.04.2014, WHICH IS REPRODUCED AS UNDER : KINDLY REFER TO THE ABOVE. THE LD. CIT(A) VIDE LETTER DATED 09/04/2014 HAS SOUGHT CLARIFICATION ON HOW THE BASIS OF RATE OF ESTIMATION ADOPTED BY THE ASSESSING OFFICER AT 4% COMMISSION ON GROSS SALES AND 3% ON PURCHASES. IN THIS REGARD, KINDLY ALSO REFER TO THE REPORT SUBMITTED BY MY PREDECESSOR ON 10/03/2010, 16/04/2010, 29/07/2010, 18/04/2011. NOW COMING TO THE ISSUE OF BASIS OF RATE OF ESTIMATION ADOPTED BY THE A. O . IN THE ASSESSMENT ORDER FOR A. Y. 2002 - 03 TO 2008 - 09, THE FACTS IN BRIEFJUST,5'ING AS TO WHY THE RATE OF ESTIMA T ION IS TAKEN AT 4% ON GROSS VALES AND 3% ON PURCHASES BY THE A.O.IS AS UNDER: FI NDINGS IN THE COURSE OF SURVEY: IN THE COURSE OF SURVEY ON 13 - 2 - 2009 THE ASSESSE STATED THAT HE HAS NOT DONE A N Y TRADING BUSINESS IN TEXTILES FROM THE YEAR 2000 ONWARDS BUT ONLY ISSUED A CCOMM O DATION SALES BILLS. IT WAS FOUND AND ESTABLISHED THAT THE MODUS OPERANDI OF THE ASSESSEE'S BUSINESS WAS TO ISSUE ACCOMMODATION BILLS AS PER THE REQUIREMENT OF THE PARTIES CONCERNED AND COLLECT CHEQUES TO THE EXTENT OF SALE PROCEEDS MENTIONED IN THE BILLS, DEPOSIT THE CHEQUES IN HIS BANK ACCOUNT AND THEN TRANSFER THE AM OUNTS AND THEN WITHDRAW CASH FROM THE BANK ACCOUNTS FOR WHICH HE HAD OPENED ACCOUNTS IN VARIOUS FICTITIOUS NAMES. THE CASH WITHDRAWN IS GIVEN TO THE SO CALLED CUSTOMERS AFTER DEDUCTING HIS COMMISSION ON SUCH SALES BILLS ISSUED. IT WAS ALSO STATED BY THE AS SESSEE IN THE COURSE OF SURVEY THAT FOR RECORD PURPOSES HE HAS PREPARED PURCHASE BILLS PRINTED AND PREPARED OR GENERATED IN COMPUTER: FURTHER IT WAS ALSO STATED THAT THE BILLS KEPT BLANK IN BETWEEN IN THE BILL BOOKS ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 20 ARE FOR THE PURPOSES OF ISSUING BACK DAT ED BILLS ALL THESE FACTS AND STATEMENTS WERE REAFFIRMED AGAIN BY THE ASSESSEE ON OATH ON 23 - 2 - 2009 IN THE STATEMENT RECO RDED U/S. 131 OF THE IT ACT. SIM ILARL Y , STATEMENTS WERE RECORDED ON OATH U/S. 131 OF SHR I MOHIT GUPTA, SON OF THE ASSESSEE AND PROP. M/S . ASTHA SILK INDUSTRIES AND S MT. HEMA R. GUPTA, WIFE OF THE ASSESSEE AND PROP. MS. SHREE RAM SALES & SYNTHETICS ON 3 3 - 2009 WHEREIN ALSO THEY HAVE CONFIRMED AND STOOD BY THE STATEMENTS RECORDED BY SHRI RAKESHKURNAR GUPTA CONFIRMING THAT THE ASSESSEE AND HI S FAMILY MEMBERS HAVE INDULGED EXCLUSIVELY IN THE ACTIVITY OF ISSUING ACCOMMODATION BILLS ONLY TO VARIOUS PARTIES FOR THE PAST 9 YEARS AND EARNING COMMISSION ON THE SAME. FURTHER, IN THE COURSE OF SURVEY, IT WAS ALSO NOTICED FROM THE DOCUMENTS THAT THE ASS ESSEE HAD CHARGED COMMISSION FROM 1 TO 40% ON THE SALES BILLS ISSUED. IT WAS ALSO AFFIRMED BY THE ASSESSEE THAT THERE ARE NO EXPENSES INCLUDING COMMISSION EXPENSES. EVEN THOUGH THE ASSESSEE HAS ADMITTED THAT HE RECEIVES 1% COMMISSION, THE SURVEY TEAM HAD F OUND THAT THE ASSESSEE IS IN THE HABIT OF ISSUING BACK DATED BILLS FOR WHICH THE PERCENTAGE OF COMMISSION IS VERY HIGH. IT WAS ALSO FOUND THAT MANY ACCOMMODATION BILLS WERE ISSUED TO D IFF ERENT PARTIES HAVING THE SAME BILL NUMBER. THE ASSESSEE HAD ALSO GIVE N THE NAMES OF THE FICTITIOUS FIRMS ON WHICH HE PREPARES THE PURCHASE BILLS. THE ASSESSEE HAS NEVER BEEN ABLE TO SUBSTANTIATE HIS PURCHASES OF CLOTH WITH EVIDENCES LIKE DELIVERY CHALLANS, LORRY RECEIPTS, PAYMENT DETAILS, ETC. NOR WERE THESE ITEMS AVAILABLE AT THE PREMISES. IT WAS STATED BY THE ASSESSEE THAT HE DOES NOT HAVE ANY GODOWN OR ANY OTHER PREMISES USED FOR THE PURPOSE OF BUSINESS. DURING THE COURSE OF SURVEY THE ASSESSEE'S AUDITOR SHRI K . M. KAP ADIA WAS ALSO PRESENT IN THE PREMISES AND EVEN HE WAS NOT ABLE TO PROVIDE WITH ANY DOCUMENTS WHICH PROVE THAT THE ASSESSEE WAS HAVING ANY TRADING ACTIVITY. FURTHER, IN THE COURSE OF SURVEY, BILL BOOKS WHICH WERE USED BY THE ASSESSEE FOR PREPARING HAVALA PURCHASES WERE FOUND AND IMPOUNDED IN RESPECT OF THE F OLLOWING CONCERNS NAMELY (1) M/ S. N . M . CORPORATION; (2) M / S . PAYAL INDUSTRIES; (3) M / S. DEEP ENTERPRISES; (4) M/S. RICH FABRICS, (5) M/ S. KAJOL I MPEX; (6) M / S. ASH OVERSEAS, (7) M/S. SHIV TEXTILES; (8) M/S. PANCHAM TEX; (9) M / S. OM CREATIONS; (10) M / S. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 21 ROY AL FABRICS; (71) M/ S. M . M . CREATIONS; (12) M/ S. SHUBAM TEX AND OTHER OBTAINED PURCHASE BILLS. THE SURVEY TEAM ALSO FOUND BLANK LETTER HEADS OF (1) M/ S. DEVANG INDUSTRIES, (2) D. KINGS, (3) MOHAMMED HAJI ADAM & CO. (4) SYED BAWKHER & CO., ( 5) GALA ASSOCIATE S STORED IN THE COMPUTER OF ASSESSEE FOR PREPARING PURCHASE ORDERS, WHICH WERE ADMITTED BY THE ASSESSEE IN THE COURSE OF SURVEY IN RESPONSE TO QUESTION NO. 17 & 34 OF THE STATEMENT. BASIS OF RATE OF ESTIMATION: MOST IMPORTANTLY IT IS MENTIONED HERE THAT AS SESSEE HAS HIMSELF ADMITTED THAT HE IS IN THE BUSINESS OF GIVING ACCOMMODATION ENTRIES TO VARIOUS ENTITIES AS STATED IN THE ORDER. TO ISSUE THE SAID ACCOMMODATION ENTRIES HE USED TO CHARGE COMMISSION FOR THE SAME. THE RATE OF COMMISSION VARIES FROM PARTY T O PARTY AND AS PER THE NEEDS OF THE PARTY. FOR THE SAME, ASSESSEE USED TO GET 4 TO 7% OF THE BILL AMOUNT AS ACCOMMODATING CHARGES. THIS AMOUNT HE USED TO RECEIVE IN CASH AND WAS NEVER DEPOSITED IN THE BANK ACCOUNT, SINCE FOR THE BILL AMOUNT HE USED TO RECE IVE THE CHEQUE AND ISSUE THE EQUIVALENT CASH AMOUNT TO THE PARTY AFTER DEDUCTING ACCOMMODATING CHARGES. THIS ACCOMMODATION CHARGES ARE NOTHING BUT INCOME OF THE ASSESSEE FOR ISSUING ACCOMMODATION ENTRIES. IT MAY BE FURTHER MENTIONED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS NOTICED THAT THE ASSESSE E HAS OFFERED TURNOVER OF RS. 5.52,51,947/ - FOR THE A. Y 2002 - 03 WHEREAS THE ACTUAL TURNOVER WAS RS.5, 70,47,800/ - AND FOR THE A. Y. 2007 - 08, THE TURNOVER OFFERED WAS RS. 7,41,82,3461 - WHEREAS THE AC TUAL TURNOVER WAS RS. 10,57,05,852/ - . THE ASSESSEE WAS GIVEN AMPLE OPPORTUNITY TO SUBMIT ALL THE DETAILS FOR COMPLETING ASSESSMENT PROCEEDINGS, BUT HE HAS NOT AVAILED THE OPPORTUNITIES. FURTHER, THE ASSESSEE HAS MADE SUBSTANTIAL INVESTMENT IN IMMOVABLE PRO PERTIES AND BY CLAIMING THAT HIS COMMISSION IS ONLY 1%, SUCH HUGE INVESTMENTS CANNOT BE MADE WHICH FACT ALSO GOES TO SHOW THAT ASSESSEE 'S COMMISSION IS MUCH MORE THAN THE SO CALLED 1% WHICH HE CLAIMS TO HAVE RECEIVED. THEREFORE, THE A.O . HAS RIGHTLY AND C ORRECTLY ESTIMATED THE INCOME AT 7% OF THE TURNOVER (SALES & PURCHASES) CARRIED OUT BY THE ASSESSEE WHICH IS MUCH LESS THAN THE PERCENTAGE CHARGED BY HAVALA ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 22 OPERATORS WHICH NORMALLY RANGES FROM 10 TO 12% FOR PROVIDING ACCOMMODATION ENTRIES. IN VIEW OF THES E FACTS, THE A.0. HAS CORRECTLY AND RIGHTLY ESTIMATED THE INCOME AT 7% BASED ON MATERIALS FO UND IN THE COURSE OF SURVEY PROCEEDINGS AT THE ASSESSEE 'S PREMISES. IT IS PERTINENT TO MENTION HERE THAT IN THE COURSE OF RE - OPENED ASSESSMENT PROCEEDINGS FOR THE A.Y S . 2003 - 04 TO 2006 - 07 AND A.Y. 2008 - 09 BEFORE THE UNDERSIGN ED, THE ASSESSEE TOTALLY FAILED TO APPEAR EXCEPT FOR ENTERING INTO CORRESPONDENCES WHICH HAS BEEN THE CONSTANT PRACTICE OF THE ASSESSEE AS NOTED IN THE PAST AS WELL WHEREIN INSTEAD OF CO M PLYING WITH THE LEGAL NOTICES THE ASSESSEE FILES VARIOUS APPLICATIONS HAVING NO SUBSTANCE IN THAT. THE ASS ESSEE FILED AN AFFIDAVIT FOR ALL THESE ASSESSMENT YEARS TAKING A STA ND THAT TRADING OF GOODS WAS CARRIED ON WITH FEW LISTED PARTIES STATED IN THE AFFIDAVIT A ND THAT HE WAS ISSUING ACCOMMODATION HILLS TO REST OF ALL THE PA R TIES WHICH ARE NOT LISTED IN THE AFFIDAVIT. THE ASSESSEE IS EITHER TRYING TO MISREPRESENT THE FACTS OR HAS MADE THE AFFIDAVIT IN CONNIVANCE WITH THE SALES PARTIES WHICH HE CLAIMS TO BE SALES ON ACCOUNT OF TRADING BUSINESS ACTIVITY . THE FILING OF AFFIDAVIT CANNOT BE ACCEPTED AS CONCLUSIVE PROOF OF THE PARTIAL SALES AND PURCHASES PURPORTED TO HAVE BEEN MADE BY THE ASSESSEE AS THE SALES AND PURCHASES PURPORTED TO HAVE BEEN MADE AS AFFIRMED IN THE AFFIDAVIT HAVE NOT BEEN SUBSTANTIATED BY SUPPLEMENTARY EVIDENCES. THE FILING OF AFFIDAVIT CAN ONLY BE TAKEN AS AN AFTERTHOUGHT TO CIRCUMVENT THE PROCEEDINGS INITIATED AGAINST THE ASSESSEE. THE LD CIT(A) WILL APPRECIATE THAT THE ASSESSEE HAS HIMSELF ADMITT ED THAT HE IS IN THE BUSINESS OF GIVING ACCOMMODATION ENTRIES AND RELYING ON THE STATEMENT OF SUCH ASSESSEE'S WILL GIVE BOOST TO THIS TYPE OF ASSESSEE'S WHO ARE HABITUATED TO ISSUE ACCOMMODATION ENTRIES. IT MAY BE VIEWED THAT ONLY AT THE INSTANCE OF DEPART MENT AFTER CARRYING OUT THE SURVEY, IT HAS COME TO KNOWLEDGE OF THE DEPARTMENT THE MODUS OPERANDI OF THE ASSESSEE WHO HAS TAKEN LIBERTY OF THE SYSTEM WITHOUT BOTHERING ABOUT THE CONSEQUENCES OF NATURE OF ACTIVITY CARRIED ON BY HIM. THE ASSESSEE WAS WELL - VE RSED AND WELL AWARE OF THE CONSEQUENCES OF ISSUING ACCOMMODATION ENTRIES BUT STILL HE HAS DONE THE SAME TO ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 23 MAKE HUGE PROFIT IN A SHORT PERIOD OF TIME AND AT THE SAME TIME ALSO USED HIS FAMILY MEMBERS AND THEIR NAME LENDING IN ISSUING THE ACCOMMODATION ENTR IES. THE ASSESSEE WAS OPERATING IN THE NAME OF VARIOUS FICTITIOUS FIRMS AND HAS ALSO OPENED VARIOUS ACCOUNTS WITH VARIOUS BANKS AND MANY BRANCHES TO TRANSFER FUND FROM ONE BANK TO ANOTHER BANK. FOR DOING ALL THESE THING HE WAS TRYING TO AVOID THE EYES OF L AW. THEREFORE, IN MY VIEW, THE ASSESSING OFFICER WAS QUITE REASONABLE AND JUSTIFIED IN ESTIMATING THE INCOME OF THE ASSESSEE @ 7%. IN VIEW OF THE ABOVE IT IS REQUESTED THAT THE L D C I T - (A) MAY DECIDE THE APPEAL ON MERITS AFTER GIVING DUE CONSIDERATION ON AL L THE DETAILS PROVIDED AS WELL AS DISCUSSED IN THE ASSESSMENT ORDERS F ROM A. Y . 2002 - 03 TO 2008 - 09.' 4.7 IN REPLY TO THE REMAND REPORT, ASSESSEE FILED REJOINDER DATED 26 - 05 - 2014, WHICH IS REPRODUCED AS UNDER : THIS REJOINDER IS BEING MADE PURSUANT TO THE REM AND REPORT IN RESPONSE TO OUR WRITTEN SUBMISSION BEFORE YOUR HONOUR RECEIVED FROM THE A. O . AT THE OUTSET, THE MAJOR DISPUTE RAISED IN THE WRITTEN SUBMISSION WAS IN RESPECT OF THE DETERMINATION/ESTIMATION OF THE INCOME BY: I) ESTIMATING THE HIGHER TURNOVER (BASED ON BILLS FOUND AT THE TIME OF SURVEY,) RATHER THAN ON THE BASIS OF BOOKS. II) ESTIMATING THE INCOME 4%, 6% AND 7% OF THE SALES BILLS. III) ESTIMATING INCOME @ 3% ON THE PURCHASES TURNOVER ROUTED THROUGH THE ACCOUNTS O PERATED BY FAMILY CONCERNS B Y TREATING THE SAME AS SALES BY SUCH ACCOUNTS/FICTITIOUS CON CERNS. IV) NOT CONSIDERING T HE LOSS ON SHARES BUSINESS IN A Y 2008 - 09 AND 2009 - 1 0 V) NOT ALLOWING ADMINISTRATIVE EXPENSES AND INTEREST TO ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 24 BANKS. VI) NOT ALLOWING THE INTEREST ON HOUSING LOANS. VII) NOT ALLOWING THE DEDUCTIONS UNDER CHAPTER VIA/V III A. VIII) NOT ALLOWING THE DIVIDEND INCOME AS EXEMPT INCOME. IX) TREATING THE AMOUNT OF BLANKS CHEQUES OF RS. 1.40 CRORES AS INCOME U/S 69A IN 2006 - 07. DISREGARDING ABOVE OTHER POINTS OF THE WRITTEN SUBMISS ION, THE REMAND REPORT FROM LD. A. O . IS ONLY ON FOLLOWING TWO POINTS: 1) FINDING OF SURVEY ACTION THAT THE APPELLANT HAD BEEN ENGAGED IN ISSUING ACCOMMODATION BILLS IN PAGE 1 TO 3 OF THE REMAND REPORT. 2) BASIS OF RATE OF ESTIMATION IN PAGE 3 TO 6 OF THE R EMAND REPORT. THE LD. A. 0. FAILED TO APPRECIATE THAT THE POINT NO (1) ABOVE WAS NO MORE DISPUTED. AT THE OUTSET, IT IS SUBMITTED THAT THE LD. A.O. JUST NARRATED THE SAME FACTS WHICH HAD ALREADY BEEN ELABORATED IN THE ASSESSMENT ORDERS AND AT THE CONTRARY NEITHER OUR GRIEVANCES DESCRIBED IN OUR WRITTEN SUBMISSION HAVE BEEN ADDRESSED NOR THE DOCUMENTARY EVIDENCES ARE PRODUCED TO SUBSTANTIATE WHATEVER HAD BEEN ALLEGED IN THE ASSESSMENT ORDERS. WITH REGARDS TO POINT NO (2) OUR FURTHER SUBMISSION IS AS UNDER: I ) ASSESSING THE HIGHER TURNOVER. THE TURNOVER WAS ASSESSED AT HIGHER FIGURES JUST BASED ON THE BILLS FOUND AT THE TIME OF SURVEY IGNORING THE BOOK FIGURE IN ALMOST ALL THE ASSESSMENT YEARS. (STATEMENT 'A' ENCLOSED DEPICTING SUMMARY OF THE FIGURES CONSIDER ED IN ASSESSMENT VIZ - A VIZ BOOK FIGURES FOR THE READY REFERENC E.). THE LD. A.O . IN REMAND REPORT HAS ONLY MENTIONED THE ASSESSMENT OF HIGHER ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 25 TURNOVER FOR AY 2002 - 03 AND A Y 2007 - 08 AND KEPT SILENT FOR OTHER YEARS. IT IS HUMBLY SUBMITTED THAT THE INCOME IN ISSUING ACCOMMODATION BILLS OCCURRED ONLY IN CASE PAYMENT AGAINST THE BILLS ARE RECEIVED AND THE BILLS SO ISSUED ARE USED BY THE BUYER OF SAID BILLS. THE BOOKS OF ACCOUNTS DULY AUDITED ARE THE CONCLUSIVE EVIDENCE AS TO CORRECTNESS AND R ECONCILIATION OF TH E BILLS ISSUED AND USED / PAYMENT RECEIVED. THE. A. O . AT NO STAGE COULD PRO VE THAT THE BILLS FOUND WERE USED BY THE BUYERS AND COMMISSION IS ACTUALLY EARNED. HE JUST MADE THE TOTAL OF BILLS FOUND AND APPLIED THE RATE OF COMMISSION TO ARRIVE AT THE INCOME, WH ICH IS INCORRECT AND RESULTING IN TO ESTIMATING THE ABSURD INCOME. IT IS SUBMITTED THAT NO ASSESSMENT SHOULD BE MADE BASED ON ASSUMPTION AND SURMISES. II) APPLYING COMMISSION RATE OF 4% / 6%AND 7% ON SALES TURNOVER AS AGAINST 1% ADMITTED BY THE APPELLANT. TH E LD. A. O . HAS APPLIED DIFFERENT RATES ON SALES TURNOVER FOR ASSESSING COMMISSION INCOME ON ACCOMMODATION BILL S @ 6% FOR AY.2002 - 03, 7% ON A. Y.2007 - 08 AND 4% FOR REST OF THE YEARS WITHOUT PUTTING ON RECORDS THE BASIS WHY DIFFERENT APPROACH HAVE BEEN ADOPTE D. THE LD. A. O . MENTIONED THAT THAT IT WAS FOUND FROM RECORDS THAT COMMISSION RANGING FROM 4% TO 7% HAVE BEEN EARNED, BUT NO DOCUMENTARY EVIDENCE WAS PROVIDED IN RESPECT OF SAID ALLEGED RECORDS, WHEREAS, IN THE CONTRARY THE APPELLANT IN HIS STATEMENT U/S 1 33A AND 131 AND DURING THE COURSE OF ASSESSMENT PROCEEDING HAS CATAGORILY ADMITTED THAT HE HAS EARNED ONLY 1% OF THE SALES AS COMMISSION. RELIANCE IS PLACED ON RECENT JUDGMENT OF MUMBAI ITAT 'E' BENCH DELIVERED ON 4 - 4 - 2014 IN THE MATTER OF SAROJ ANIL STEE L PVT LTD. V/S I TO HAVING SIMILAR FACTS WHEREIN IN SECOND APPEAL BEFORE THE ITAT, THE H A WALA INCOME WAS CONSIDERED @1% AS AGAINST THE 0.409% CONSIDERED BY THE FIRST APPELLATE AUTHORITY AND ALSO DIRECTED TO ALLOW CERTAIN ADMINISTRATIVE EXPENSES. HOWEVER, TH E MATTER AGAIN REACHED BEFORE THE TRIBUNAL ON THE GROUNDS OF REDUCING THE TURNOVER MADE AMONG THE SISTER CONCERN BUT THE APPEAL DISMISSED SINCE THE ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 26 GROUND WAS RAISED FIRST TIME BEFORE THE ITAT. IT IS SUBMITTED THAT THE RATE OF COMMISSION ALWAYS HIGHER IN S TEEL PRODUCTS WHERE THE TAXES LIKE SALES TAX ARE INVOLVED AND THERE ALWAYS BE COMPLIANCE COST. IN OUR CASE THE APPELLANT WAS DEALING IN TEXTILES FABRICS WHICH DO NOT HAVE ANY SUCH COMPLIANCE, THEREFORE, THE RATE OF COMMISSION SHOULD HAVE LOWER, HOWEVER, SI NCE APPELLANT HAS ALREADY ADMITTED 1% COMMISSION, IT IS SUBMITTED TO ALLOW COMMISSION @ 1% OF SALES. III) ESTIMATING COMMISSION @ 3% ON PURCHASES. IT W AS ALREADY POINTED OUT BY THE AO . IN THE ASSESSMENT ORDERS AND REMAND REPORT AS WELL THAT THE APPELLANT HAD BEEN MAINTAINING (THROUGH HIMSELF AND OTHER FAMILY MEMBERS) OTHER ACCOUNTS TO ROUTE THE PAYMENT FROM THE PRINCIPAL ACCOUNT TO THOSE ACCOUNTS TO SHOW PURCHASES. THE A O HAS TREATED THOSE ACCOUNTS AS FICTITIOUS CONCERNS AND ALSO APPLIED 3% RATE AS COMMISS ION. IT IS SUBMITTED THAT IT IS UNDISPUTED FACT THAT THE SALES FROM THE FICTITIOUS ACCOUNTS ARE SHOWN AS PURCHASE IN MANOJ MILLS (PRINCIPAL PROPRIETORY CONCERN) AND THAT THE PURCHASES BILLS IN THE PRINCIPAL CON CERNS ARE MADE BY THE APPELLANT HIMSELF THER EFORE, IF ANY COMMISSION INCOME IS ESTIMATED ON SALES FROM FICTITIOUS CONCERNS, IT SHOULD BE ALLOWED PRINCIPAL CONCERNS. THERE CANNOT BE DOUBLE ASSESSMENT OF INCOME ONCE ON THE FICTITIOUS CONCERNS AND ANOTHER ON THE SALES OF THE PRINCIPAL CONCERNS, WHEREAS THE FICTITIOUS CONCERNS ARE SHOWN AS PURCHASES IN THE PRINCIPAL CONCERN. FURTHER, NO INCOME CAN BE EARNED FROM HIMSELF THEREFORE, ADDITION MADE ON THIS GROUND IS LIABLE TO BE DE L E TED. IV) NOT CONSI D ERING THE LOSS ON SHARES BUSINESS IN AY 2008 - 09 AND 2009 - 10 THE APPELLANT INCURRED THE LOSS FROM THE SHARE BUSINESS OF RS. 1,24,58,478 IN A Y 2 008 - 09 INVOLVING SERIES OF TRANSACTIONS AS BUSINESS (TRANSACTION DETAILED WHEREOF WERE SEIZED DEPARTMENT AND NOT SHARES WITH THE APPELLANT DESPITE REQUEST). IT IS SUBMITT ED TH AT THE APPELLANT THOUGH HAS SHOWN ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 27 THE SAME IN THE RETURN OF INCOME AS CAPITAL LOSS, YET THE S SHOULD BE ASSESSED AS BUSINESS LOSS IN VIEW OF REJECTION OF BOOKS OF ACCOUNTS. IN A Y 2009 - 10, THE ASS ESSEE ALSO MADE LOSS OF RS. 99, 78,290 IN SHARE BUSINESS (SHOWN I N RETURN AS BUSINESS LOSS), DETAILS WHEREOF WERE ATTACHED WITH THE WRITTEN SUBMISSION A1OG WITH COPIES OF BILLS AND SCRIPWISE STATEMENT OF LOSS AND SHARED WITH LD. A. 0. HOWEVER, THE LD. A. O. DID NOT ADDRESS THE ISSUE IN THE REMAND REPORT ASSUMING THAT HE HAS NOTHING TO SAY IN THIS POINT. THEREFORE, IT IS REQUESTED TO ALLOW THE LOSS F R OM SHARE BUSINESS. V) NOT ALLOWING ADMINISTRATIVE EXPENSES AND BANK INTEREST. IT IS UNDISPUTED THAT THE ASSESSEE WAS HAVING CASH CREDIT BANKING FACILITIES FROM VA RIOU S BANKS AND ALSO HAVING THE OFFICE /ADMINISTRATIVE SET UP TO RUN THE SHOW. THE APPELLANT WAS FORCED TO OBTAIN THE CREDIT FACILITIES FROM BANKS IN VIEW OF WITHHOLDING THE AMOUNT OF CHEQUES GIVEN FOR, DISCOUNTING OF 1.40 CRORES BY MR. MADANLAL BAGECHA. THERE FORE, THE AMOUNT OBTAINED FROM BANKS/INSTITUTION WAS USED IN BUSINESS TO RUN THE SHOW. THE RESPECTIVE RECORDS WERE SEIZED BY THE DEPARTMENT AT THE TIME OF SURVEY AND IN THE CUSTODY OF THE DEPARTMENT. THEREFORE THE INTEREST ON UNSECURED LOANS FROM BANKS AND OTHER CERTAIN ADMINISTRATIVE EXPENSES SHOULD BE ALLOWED TO ASSESS THE FAIR INCOME. VI) NOT ALLOWING THE INTEREST ON HOUSING LOANS. IT IS UNDISPUTED THAT THE APPELLANT HAD AVAILED THE HOUSING LOANS AND PAID THE INTEREST. HOWEVER, THE LD. A. 0. DISALLOWED T HE SAME MERELY ON THE BASIS OF THE NOT SUBMITTING THE CERTIFICATE OF INTEREST. IT IS SUBMITTED THAT SINCE ALL THE RECORDS WERE SEIZED BY THE DEPARTMENT, APPELLANT WAS NOT IN POSITION TO SUBMIT THE SAME BEFORE A. 0. HOWEVER, APPELLANT SHALL BE N POSITION T O SUBMIT THE SAME ONCE THE SEIZED RECORDS ARE RETURNED TO APPELLANT. WE HAVE ALREADY ENCLOSED THE EVIDENCE OF HOUSING LOANS OBTAINED WITH THE WRITTEN SUBMISSION. THEREFORE, IT IS HUMBLY ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 28 REQUESTED TO EITHER ALLOW THE HOUSING LOANS INTEREST SINCE THE STATUTO RY PROVISIONS BEING INCENTIVE IN NATURE OR TO DIRECT THE AO TO ALLOW THE SAME AFTER DUE VERIFICATION. IT IS ALSO WORTHWHILE TO NOTE THAT THE LD. A.O. NOT ONLY NOT AL LOWED THE INTEREST PAID ON HOUSING LOAN TO THE EXTENT OF RS. 15000 0/ - BUT ALSO ADDED BA CK IN THE INCOME FROM THE OTHER SOURCES BY RS. 422,432 IN AY 2008 - 09. THE AO FAILED TO UNDERSTAND THAT ONLY INCOME CAN BE ADDED NOT THE EXPLAINED EXPENSES. T H US THE SAID ADDITION IS LIABLE TO BE DELETED ON FACTUAL G ROUNDS. VII ) NOT ALLOWING THE DEDUCTIONS UNDER CHAPTER VIA/V III A. THE A O DID NOT DISCUSS THE ISSUE OF ALLOWING CHAPTER VIA/V III A DEDUCTION IN THE ASSESSMENT ORDER. THEREFORE, IT IS REQUESTED TO DIRECT THE AO TO ALLOW THE SAME AFTER DUE VERIFICATION, WHEREVER APPLICABLE. VIII) NOT ALLOWING THE DIV IDEND INCOME AS EXEMPT INCOME. IT IS WELL KNOWN FACT THAT THE SHARES ARE HELD IN 'D' M AT FORM' AND DIVIDENDS WERE DIRECTLY CREDITED TO DESIGNATED BANK ACCOUNT SHOWING THE NAME OF THE COMPANY IN BANK STATEMENT. THE SAID STATEMENT WERE ALREADY IN THE POSSESSI ON OF THE A. 0. BUT HE DID NOT TRY TO ASCERTAIN THE SAME WHICH HE COULD HAVE SIMPLY VERIFY FROM THE OBSERVATION OF THE BANK ACCOUNT. THEREFORE, IT IS REQUESTED TO ALLOW THE DIVIDEND INCOME AS EXEMPT INCOME U/S 10. (A Y 2006 - 0 7 RS. 10841 / - ) IX) TREATING TH E AMOUNT OF BLANKS CHEQUES OF RS. 1.40 CRORES AS INCOME 'IS 69A IN A 2006 - 07. A DETAILED WRITTEN SUBMISSION WAS MADE BEFORE YOUR HONOUR WAS ALREADY SHARED WITH THE LD. A. O . IN THIS RESPECT. HOWEVE R, NOTHING WAS STATED BY THE A.O . TO COUNTER OUR ARGUMENTS. WITHOUT REPRODUCING AGAIN THE FACTS AND LEGAL POSITION ON THIS ISSUE, WE REQUEST YOUR HONOUR TO DELETE THE ADDITION. FURTHER, TO ENABLE YOUR HONOUR TO HAVE THE DETAILS OF INCOME RETURNED AND ASSESSED AT ONE PLACE ARE SUMMARIZED IN THE STATEMENT 'A' ENCLOS ED. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 29 IT IS ALSO WORTHWHILE TO SUBMIT THAT THE ASSESSMENT OF INCOME IN THE CASE OF APPELLANT AND FAMILY MEMBERS WERE MADE AT THE SUBS TANTI AL HIGHER AMOUNT, WHICH WAS NOT RECIPROCATED BY THE WEALTH/UNDISCLOS ED EXPENSES. THE A. O . ONLY OBSERVED THAT THE APPELLA NT HAS ACCUMULATED OF IMMOVABLE PROPERTIES, BUT FAILED TO APPRECIATE THE FACT THAT THESE PROPERTIES WERE OBTAINED WITH HOUSING LOANS. AS OF NOW THE LO ANS ARE MORE THAN THE VALUE OF PROPERTIES. THUS THE INCOME SO ASSESSED ARE ERRONEOUS AND BEYOND THE STRETC H OF IMAGINATION THE STATEMENT SHOWING THE PROPERTIES AND LOANS ARE ENCLOSED AS STATEMENT 'B. FINALLY, WE HEREBY RE QUEST YOUR HONOUR TO ALLOW THE APPEAL TAKING THE JUDICIAL AND REALISTIC APPROACH. 4 .8 AFTER CONSIDERING THE SAME, CIT(A) HELD AS UNDER: 4.6. I HAVE PERUSED FACTS AND CIRCUMSTANCES OF THE CASE AND THE WRITTEN SUBMISSION, REMAND REPORT AND REJOINDER VERY CAREFU LLY. I FIND THAT THE APPELLANT H AS AGREED OF HAVING ISSUED THE HAWALA BILLS FOR COMMISSION AND SUBMITTED THAT FINALLY THE DISPUTE BET WEEN THE AO AND THE APPELLANT IS BROADLY ON TWO POINTS I.E. (I) ESTIMATING THE TURNOVER AT RS.5,70,47,800/ - ON THE BASIS OF SALE BILLS FOUND DURING SURVEY AS AGAINST AUDITED TURNOVER OF RS.5,5 1,51,947/ - AND (II) ESTIMATING THE GROSS PROFIT RATE ON ISSUING HAWALA BILLS @ 6% AS AGAINST 1% CLAIMED AS EARNED BY THE APPELLANT. ACCORDINGLY, THE APPELLANT HAS SUBMITTED REVISED COMPUTATION OF HIS INCOME AT RS.3,70,338/ - . HERE IT IS PERTINENT TO NOTE THAT EARLIER THE APPELLANT HAD RETRACTED HIS OWN STATEMENTS U/S 133A & 131, WHEREBY HE CLAIMED THAT HE HAD EARNED A PROFIT OF 3% TO 4% IN TRADING ACTIVITIES WITH FEW PARTIES AND 1% IN HAWALA ACTIVITIES; HOWEVER NOW THE APPELLANT HAS NOT GIVEN ANY SUCH SEGREGATION,. AND APPLIED THE UNIFORM RATE OF 1% ON ENTIRE TURNOVER AS PER BOOKS OF RS.5,52,51,947/ - THIS SEEMS TO BE AN INDIRECT ADMISSION OF APPELLANT THAT THE WHOLE TURNOVER OF APPELLANT WAS ON ACCOUNT OF ISSUING ACCOMMODATION BILLS, AND NOT ON ACCOUNT OF ANY GENUINE TRADING TURNOVER AS CLAIMED IN HIS OWN RETRACTION OF THE STATEMENTS U/S 133A/131. IT ALSO SHOWS THAT THE APPELLANT IS CHANGING HIS STATEMENT AGAIN AND AGAIN, AND HENCE THE APPELLANT'S PRESENT SUBMISSIONS ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 30 CANNOT BE ACCEPTED ON THE FACE OF IT. FURTHER, THERE IS NO DOCUMENTARY EVIDENCE SUBMITTED BY THE APPELLAN T TO PROVE THAT HIS COMMISSION ON ACCOMMODATION BILLS WAS NOT MORE THAN 1%. THEREFORE, THE APPELLANT'S PRESENT SUBMISSION SEEMS TO BE NOTHING BUT A LAME ATTEMPT TO SOMEHOW BRING HIS REVISED COMPUTED INCOME NEAR TO HIS RETURNED INCOME, WHICH IS NEIT HE R SUPP ORTED BY HIS OWN STATEMENTS IN THE PAST, NOR WITH ANY DOCUMENTARY EVIDENCES. IN SUCH CIRCUMSTANCES, THE BEST JUDGMENT ASSESSMENT MADE BY THE AO HAS TO BE LOOKED INTO OBJECTIVELY BASED ON THE FACTS AND CIRCUMSTANCES OF THE CASE ON RECORD. 4 .7. THE AO IN PA RA 27(VII) OF THE ASSESSMENT ORDER HAS NOTED THAT THE COMMISSION EARNED VARIES FROM 2 TO 4%, AS IT APPEARS FROM THE STATEMENT/DOCUMENTS FOUND DURING THE COURSE OF SURVEY, AND THE COMMISSION EARNED IN CASH WHILE HANDING OVER THE MONEY TO CUSTOMERS AND IN FI CTITIOUS SUPPLIER'S ACCOUNTS WERE NEVER ACCOUNTED FOR. THE AO HAD PROPOSED TO ASSESS THE GROSS COMMISSION @7% OF TURNOVER IN THE SHOW CAUSE NOTICES, BUT FINALLY ASSESSED THE GROSS COMMISSION ONLY @6%. IN THIS REGARD, IT IS AN ESTABLISHED FACT THAT THE APPE LLANT HIMSELF USED TO PREPARE THE PURCHASE BILLS OF HIS VARIOUS FICTITIOUS ENTITIES CORRESPONDING TO THE ACCOMMODATION SALE BILLS ISSUED BY HIM, AND THE RETURNS OF INCOME OF SUCH FICTITIOUS ENTITIES WERE NEVER FILED. ALSO THE APPELLANT USED TO ISSUE BACK DATED BILLS, WHICH FACT HAS BEEN SUBSTANTIALLY PROVED BY THE AO. THESE DUBIOUS ACTIVITIES OF THE APPELLANT AS A WHOLE WOULD COMMAND HIGH PROFIT MARGIN AND HENCE THE ESTIMATED MARGIN TAKEN BY THE AO @6% OF TURNOVER DOES NOT SEEM TO BE HIGH HANDED. NO DOUB T, SOME GUESS WORK IS INVOLVED IN THE BEST JUDGMENT ASSESSMENT, HOWEVER; AS HELD BY THE HON'BLE SUPREME COURT IN THE CASE OF CST VS. H.M. ESUFALI H.M. ABDULALI [1973] 90 ITR 271 (SC), IN CASE OF ESTIMATION, SOME GUESS WORK IS NECESSARY AND INEVITABLE AND W HICH CANNOT BE SUBSTITUTED BY ANY OTHER AUTHORITY, IF THE ESTIMATION IS BASED ON SOME RATIONAL FACTS. THE HON'BLE SUPREME COURT HAS ALSO HELD IN SAID CASE THAT 'THE ASSESSEE CANNOT BE PERMITTED TO TAKE ADVANTAGE OF HIS OWN ILLEGAL ACTS. IT WAS HIS DUTY TO PLACE ALL FACTS TRUTHFULLY BEFORE THE ASSESSING AUTHORITY. IF HE FAILS TO DO HIS DUTY, HE CANNOT BE ALLOWED TO CALL UPON THE ASSESSING AUTHORITY TO PROVE CONCLUSIVELY WHAT TURNOVER HE HAD ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 31 SUPPRESSED. THAT FACT MUST BE WITHIN HIS PERSONAL KNOWLEDGE. HENCE, THE BURDEN OF PROVING THAT FACT IS ON HIM '. I FIND THAT THE APPELLANT HAS GROSSLY FAILED IN THE BURDEN CAST ON HIM TO PROVE THAT HE HAD NOT EARNED MORE THAN WHAT IS CLAIMED TO HAVE EARNED BY HIM; RATHER THE CONFLICTING STATEMENTS OF APPELLANT AT VARIOUS TI MES HAVE PROVED THAT THE APPELLANT'S CLAIM DO NOT HAVE ANY SANCTITY. IN THESE CIRCUMSTANCES, THE BEST JUDGMENT ASSESSMENT MADE BY THE AO CANNOT BE QUESTIONED. THE HON'BLE SUPREME COURT HAS FURTHER HELD IN AFORESAID CASE THAT 'IF THE ESTIMATE MADE BY THE AS SESSING AUTHORITY IS A BONAFIDE ESTIMATE AND IS BASED ON A RATIONAL BASIS, THE FACT THAT THERE IS NO GOOD PROOF IN SUPPORT OF THAT ESTIMATE IS IMMATERIAL. PRIMA FACIE, THE ASSESSING AUTHORITY IS THE BEST JUDGE OF THE SITUATION. IT IS HIS 'BEST J UDGMENT' A ND NOT OF ANYONE ELSE '. I FIND THAT THE AO HAS NARRATED SUFFICIENT PROOF IN THE ASSESSMENT ORDER AND THE VARIOUS REMAND REPORTS SHOWED THAT THE APPELLANT IS ENGAGED IN DUBIOUS ACTIVITIES OF PROVIDING ACCOMMODATION BILLS, AND EARNING MUCH MORE THAN THE RETU RNED INCOME. THE BEST JUDGMENT MADE BY HIM OF THE GROSS COMMISSION INCOME @4% ON SALES, PLUS ON PURCHASES (FINALLY RESTRICTED TO @6% OF TURNOVER IN AGGREGATE) DOES NOT SEEM TO BE EXAGGERATED IN THE WHOLE FACTS AND CIRCUMSTANCES OF THE CASE. NORMALLY ANY IL LEGAL ACTIVITY COMMANDS HIGHE R PROFIT MARGIN THAN LEGAL ACTIVITIE S, AS THE RISKS INVOLVED TO THE PERSON EN GA GED IN SUCH ILLEGAL ACTIVITY ARE MANIFOLD. IN THIS CONTEXT, THE I.T. ACT, 1961 ITSELF PROVIDES PRESUM PTIVE RATES OF TAX FOR SMALL BU SINESSMAN CARRY ING ON LEGAL ACTIVITIES BUT NOT REQUIRED TO MAINTAIN BOOKS, RANGING BETWEEN 5 TO 10 % UNDER VARIOUS PROVISIONS OF THE ACT, AS SHOWN IN THE PREVIOUS APPELLATE ORDER OF MY PREDECESSOR. THE FACT THAT THE ASSESSEE HAS MADE SUBSTANTIAL INVESTMENTS IN IMMOVABLE P ROPERTIES AND IF ASSESSEE CLAIMS THAT HIS COMMISSION IS ONLY 1%, HOW HE CAN MAKE SUCH HUGE INVESTMENTS IS NOT DISPUTED BY THE APPELLANT. THIS FACT ALSO GOES TO SHOW THAT ASSESSEE'S COMMISSION IS MUCH MORE THAN THE SO CALLED 1%. IN VIEW OF THIS, THE ESTIMAT E MADE BY THE AO IS REASONABLE AND THE SAME IS HEREBY CONFIRMED. THE GROUND OF APPEAL IS REJECTED. 4.8. AS REGARDS THE TURNOVER ESTIMATED AT RS.5,70,47,800 / - BASED ON ACCOMMODATION BILLS ISSUED AS FOUND DURING THE ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 32 COURSE OF SURVEY, AS AGAINST TURNOVER OF RS.5,52,51,947 / - DECLARED BY THE APPELLANT; I AM OF THE OPINION, THAT ONCE THE BOOKS OF ACCOUNTS OF APPELLANT ARE REJECTED, THE ENTRIES MADE IN THE BOOKS DO NOT HAVE ANY SANCTITY AND THE AO WAS JUSTIFIED IN ESTIMATING THE TURNOVER ON THE BASIS OF MATERIAL IN HER POSSESSION. 5. IN THE RESULT, THE APPEAL IS DISMISSED. 5 . BEFORE US, IT WAS SUBMITTED ON BEHALF OF ASSESSEE THAT CIT(A) ERRED IN CONFIRMING THE ACTION OF ASSESSING OFFICER IN COMPUTING THE COMMISSION @ 6% ON BILLING OF RS.5,70,47,800/ - AS AGAINS T 1% CLAIMED AND ADMITTED ON ACTUAL BILLS ACCOUNTED IN BOOKS AND NOT CONSIDERING THE TOTAL DEPOSITS IN BANK THAT SUBSTANTIATE THE BILLING ACCOUNTED FOR IN THE BOOKS OF ACCOUNT. FURTHER, IT WAS SUBMITTED THAT CIT(A) ERRED IN FACTS AND LAW IN CONFIRMING THE ACTION OF ASSESSING OFFICER OF CALCULATING THE COMMISSION @ 6% AS AGAINST 1% ADMITTED DURING COURSE OF SURVEY PROCEEDINGS, MERELY BASED ON SURMISES AND CONJECTURES AND WITHOUT BRINING ON RECORD ANY MATERIAL TO SHOW THAT ASSESSEE HAD IN FACT EARNED SUCH A COMMISSION AT ALLEGED HIGHER RATE OF 6%. FURTHER, CIT(A) ERRED IN CONFIRMING THE ACTION OF ASSESSING OFFICER ASSUMING THE BASE OF BILLING AT RS.5,70,47,800/ - AGAINST BILLING OF RS.5,52,51,947/ - RECORDED IN THE BOOKS OF ACCOUNTS AND NOT MAKING ANY REFERENC E TO BANK BOOK AND STATEMENTS IMPOUNDED DURING COURSE OF SURVEY. 5.1 REGARDING TURNOVER, STAND OF ASSESSEE HAS BEEN THAT IN ACCOMMODATION BUSINESS TURNOVER TO BE COMPUTED ON RECEIPTS BASIS AND NOT ON ASSUMPTION BASIS. LD. AUTHORIZED REPRESENTATIVE SUBMIT TED THAT ASSESSING OFFICER WHILE TAKING ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 33 TURNOVER OF RS.5,70,47,800/ - INSTEAD OF RS.5,52,51,947/ - IN SHOW CAUSE NOTICE STATED THAT ASSESSEE HAD ISSUED THE BILLS OF RS.5,70,47,800/ - THEREFORE THE BILLS ISSUED AMOUNT WILL BE TURNOVER OF ASSESSEE. BUT, ASSESS ING OFFICER FAILED TO CONSIDER THAT IN ACCOMMODATION BILL BUSINESS, TURNOVER SHOULD BE AMOUNT, FOR WHICH, AMOUNTS WERE REALIZED BECAUSE THE COMMISSION WILL BE EARN ONLY ON MAKING THE CASH PAYMENT TO PARTY AFTER RECEIPT OF CHEQUE. IF THE AMOUNT OF CHEQUE N OT REALIZE, THEN NO COMMISSION INCOME WILL BE EARN ED . HENCE, TURNOVER RECORDED IN BOOKS OF ACCOUNT AND BANK STATEMENT IS TO BE TREATED AS TURNOVER. HENCE, TURNOVER REPORTED BY ASSESSEE REQUIRED TO BE CONSIDERING FOR DETERMINING THE COMMISSION INCOME. TH E ISSUE OF DETERMINATION OF TURNOVER IN CASE OF ACCOMMODATION TRANSACTION COMES BEFORE THE ITAT IN CASE OF SANJAY KUMAR GARG VS. ACIT [2011] 12 TAXMANN.COM 294 (DELHI) WHERE THE TRIBUNAL HELD AS UNDER: THE L D. CIT (APPEALS) HAS GIVEN A FINDING OF FACT TH AT THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF PROVIDING ACCOMMODATION ENTRIES AND, THEREFORE, THE AMOUNTS DEPOSITED IN THE ACCOUNT OF DUMMY CONCERNS WAS TO BE TREATED AS TOTAL RECEIPTS ON WHICH COMMISSION WAS TO BE DETERMINED. THEREFORE, WE ARE IN AGREEME NT WITH THE VIEW OF THE L D. CIT (A) THAT ONLY COMMISSION CAN BE DETERMINED ON THE DEPOSITS MADE IN THE BANK ACCOUNTS OF THE DUMMY CONCERNS. THEREFORE, WE DO NOT FIND ANY INFIRM ITY IN THE ORDER PASSED BY THE L D. CIT (A) THAT THE AMOUNT DEPOSITED IN THE ACCO UNT OF DUMMY CONCERNS CANNOT BE TREATED AS INCOME OF THE AS SESSEE. THEREFORE, THE L D. CIT (A), IN OUR CONSIDERED OPINION, IS JUSTIFIED IN TREATING THE CASH DEPOSITED IN VARIOUS BANK ACCOUNTS CONTROLLED AND OPERATED BY THE ASSESSEE AS THE TURNOVER OF THE AC COMMODATION ENTRY BUSINESS AND COMMISSION INCOME HAS TO BE ESTIMATED ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 34 THEREON. 5.2 IN THIS BACKGROUND, LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT ASSESSING OFFICER WAS INCORRECT IN ASSUMING TURNOVER AND REQUIRED TO BE ADOPTED THE TURNOVER AS REFLECTED I N BOOKS OF ACCOUNT. 6. WE FIND THAT IT IS NOT CASE OF TURNOVER AND TAX THEREON BUT REGA RDING ESTIMATION OF COMMISSION O N SUCH BUSINESS OF ACCOMMODATION ENTRIES AND TAX THEREON . REGARDING RATE OF COMMISSION ADOPTED BY ASSESSING OFFICER AT 6%. LD. AUT HORIZED REPRESENTATIVE SUBMITTED THAT IT WAS VERY ABNORMAL AND CANNOT HAPPEN IN CASE OF ACCOMMODATION BUSINESS. FURTHER, THE RATE OF PRESUMPTIVE PROFIT REFERRED BY THE CIT(A) C OULD NOT BE CONSIDERED IN CASE OF ACCOMMODATION BUSINESS . ASSESSEE IN HIS STATE MENT DATED 13/02/2009 & 2 3 / 02/ 2 00 9 STATE D THAT COMMISSION INCOME IS EARNED @ 1% ON THE SALES ALSO CLAIMED CERTAIN EXPENSE THREON . THE RATE MENTION ED BY ASSESSEE IS THE RATE WHICH IS PREVAIL ING IN THIS LINE. IN THIS REGARD, LD. AUTHORIZED REPRESENTATIVE SU BMITTED THAT T HIS ISSUE OF DETERMINATION OF R ATE OF COMMISSION IN CASE OF ACCOMMODATION TRANSACTION AROSE BEFORE THE ITAT IN CASE OF SAN JAY KUMAR GARG VS . ACIT [ 2011 ] 12 TAXMANN.COM 294 (DELHI) WHERE IN TRIBUNAL HELD AS UND ER: - 49. THE NEXT ISSUE ARISES FOR ESTIMATION OF COMMISSION INCOME. IN THE STATEMENT THE ASSESSEE AT THE TIME OF SURVEY UNDER SECTION 133A HAD STATED THAT HE CHARGED 25P AS COMMISSION FOR PROVIDING ACCOMMODATION ENTRIES AND OUT OF THAT 25P HE PAID LOP T O OTHERS IN WHOSE NAME BANK ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 35 ACCOUNTS WERE MAINTAINED AND 5P WAS SPENT ON EXPENSES INCURRED IN RELATION SUCH BUSINESS AND HENCE, NET COMMISSION EARNED WAS L 0P I.E., 0.10 PER CENT. THE L D. CIT (A) HAD TAKEN THE COMMISSION AT 1 PER CENT AS AGAINST 1.75 PER CE NT APPLIED BY THE ASSESSING OFFICER FOR WHICH NO EVIDENCE DURING THE C OURSE OF SURVEY WAS FOUND. THE L D. CIT (A) HAS ALSO NOTED THAT THERE WAS NO CLEAR STANDARD RATE OF COMMISSION FOR ACCOMMODATION ACTIVITIES. ACCORDING TO HIM THE PEOPLE WHO ARE ENGAGED IN THIS TYPE OF BUSINESS WOULD NOT CHARGE LESS THAN 1 PER CENT ON THE BILL AMOUNT AS DONE IN THE CASE OF BROKERAGE ON REAL ESTATE BUSINESS. HE FURTHER OBSERVED THAT THE RATE OF 1 PER CENT COMMISSION IS VERY REASONABLE. NOW THE ISSUE ARISES AS TO WHETHER THE C OMMISSION SHOULD BE ESTIMATED AT THE RATE OF .01 PER CENT OR 1. 75 PER CENT OR 1 PER CENT. THE L D. CIT (A) FOR ARRIVING AT THE RATE OF COMMISSION EARNED HAS RELIED ON RATE OF COMMISSION NORMALL Y CHARGED IN CASE OF REAL ESTATE TRANSACTIONS. IN REAL ESTATE TR ANSACTIONS THE BROKER HAS TO IDENTIFY / THE SUITABLE BUTLER/ PURCHASER, INSPECTION OF PRO PERT Y , VISIT OF INTERESTED PARTIES, NEGOTIATIONS OF RATES, REGISTRATION OF SALE DEEDS ETC. WHEREAS IN CASE OF BOGUS ENTRIES PROVIDERS NO SUCH ACTIVITIES ARE INVOLVED. I NTERESTED PART Y GIVES CASH TO ENTRY PROVIDER WHICH IS DEPOSITED IN BANK ACCOUNT AND THE ENTR Y PROVIDER ISSUES CHEQUE. HENCE THE TRANSACTIONS OF BOGUS ENTRY PROVIDERS CANNOT BE COMPARED WITH THE TRANSACTIONS OF REAL ESTATE BUSINESS TRANSACTIONS. HE HAS TO E NSURE THE NATURE OF THE PROPERTY AND HAS TO SATISFY BOTH SELLER AND PURCHASER. THE SERVICES RENDERED BY THE BROKERS IN REAL ESTATE TRANSACTIONS ARE MORE THAN THE ENTRY PROVIDERS. HENCE BOTH THE TRANSACTIONS ARE NOT COMPARABLE. THEREFORE , THE COMPARISON OF COMMISSION EARNED ON A REAL ESTATE TRANSACTION, WHICH IN FACT TAKES PLACE AND COMMISSION ON TRANSACTION WHICH DOES NOT AT ALL OCCUR , ARE NOT CO M PARAB L E. IN ACCOMMODATION ENTRIES THE TRANSACTION DOES NOT TAKE PLACE AND, THEREFORE, COMMISSION WILL BE CERTAIN LY LOWER THAN THE COMMISSION IN THE CASE OF REAL ESTATE OR REAL TRANSACTIONS. MOREOVER, NEITHER THE LD. CIT(A) NOR THE ASSESSING OFFICER HAD GIVEN ANY COMPARABLE CASE WHEREIN COMMISSION AT THE RATE OF 1.75 PER CENT AS TAKEN BY THE ASSESSING OFFICER OR 1 P ER CENT ADOPTED BY THE LD. CIT(A) HAS BEEN ADMITTED BY OTHER ASSESSEES ENGAGED IN BUSINESS OF BOGUS PROVIDER. THEREFORE, IN THE ABSENCE OF ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 36 ANY SUCH MATERIAL ON RECORD, THE STATEMENT GIVEN BY THE ASSESSEE ON OATH DURING THE COURSE OF SURVEY PROCEEDINGS HAS TO BE GIVEN CREDENCE. THE ASSESSEE HAS FLOATED THE BOGUS CONCERNS AND HAS CONTROLLED THE ACCOUNTS. DURING THE COURSE OF SURVEY, NO MATERIAL WAS FOUND ON THE BASIS OF WHICH IT COULD BE SAID THAT THE ASSESSEE HAD PASSED ON. 1 PER CENT COMMISSION TO THE PER SONS IN WHOSE NAMES THE BANK ACCOUNTS WERE MAINTAINED. IN THE ABSENCE OF ANY EVIDENCE HAVING BROUGHT ON RECORD, WE ARE UNABLE TO AGREE WITH THE ASSESSEE THAT THE ASSESSEE HAD PASSED ON COMMISSION OF LOP TO THE PERSONS IN WHOSE NAMES DUMMY CONCERNS WERE FLO ATED. HOWEVER, IN THE BUSINESS OF ENTRY PROVIDER CERTAIN EXPENDITURE HAS TO BE INCURRED WHICH HAS BEEN STATED TO BE 5P DURING THE COURSE OF SURVEY. THEREFORE, CREDIT OF 5P OUT OF 25P RECEIVED AS COMMISSION HAS TO BE ALLOWED. THEREFORE, THE ASSESSING OFFICE R IS DIRECTED TO ESTIMATE COMMISSION INCOME BY APPLYING 0.2 PER CENT NET COMMISSION ON TURNOVER DETERMINE D BY THE LD. CIT (A) FOR BOTH THE ASSESSMENT YEARS AS AGAINST 1 PER CENT TAKEN BY HIM. 6 .1 WE FIND THAT TRIBUNAL IN CASE OF SAN JAY KUMAR GARG VS . ACIT (SUPRA) HELD THAT RATE OF COMMISSION CANNOT BE MORE THAN 1%, BUT IN PRESENT CASE , ASSESSEE HAD ALREADY OFFERED THE SAME FOR TAXATION PURPOSE BUT WITH RIDER OF ALLOWABILITY OF CERTAIN EXPENSE AGAINST SAME . HENCE, THE RATE OF 6% ADOPTED BY ASSESSING OFFICE R WAS HIGHLY ONE . HENCE, THE COMMISSION INCOME WAS TO BE TAKEN @ 0.6 % OF SALES TURNOVER . S IMILAR VIEW HAS ALSO BEEN TAKEN BY THE JURISDICTIONAL MUMBAI TRIBUNAL IN CASE OF GOLD STAR FINVEST (P.) LTD VS . ITO [2013] 33 TAXM ANN.COM 129 (MUMBAI TRIB.) , WHEREIN TRIBUNAL HELD AS UNDER: 12. HAVING CAREFULLY EXAMINED THE VARIOUS ORDERS IN THE CASE OF DIFFERENT ASSESSEES' IT HAS BECOME AMPLY CLEAR THAT IN THESE TYPE OF ACTIVITIES BROKERS ARE ONLY CONCERNED WITH THEIR COMMISSIO N ON THE VALUE OF THE TRANSACTIONS. NOW THE QUESTION COMES WHAT WOULD BE THE REASONABLE PERCENTAGE OF ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 37 THE COMMISSION ON THE TOTAL TURNOVER ? THE ASSESSEE HAS ALSO MADE OUT A CASE THAT THE CUSTOMERS DO NOT COME DIRECTLY TO HIM AND THEY COME THROUGH A SUB - BR OKER WHO ALSO CHARGE A PARTICULAR SHARE OF COMMISSION. IN ALL THE JUDGMENTS WHAT HAS BEEN STATED IS THAT AN AVERAGE PERCENTAGE OF COMMISSION IS BETWEEN . 15% TO .25%. IN THE CASES OF PALRESHA & CO. (SUPRA) AND KIRAN & CO. (SUPRA), THE TRIBUNAL HAS CONSIDERE D REASONABLENESS OF PERCENTAGE OF COMMISSION TO BE EARNED ON TURNOVER WAS AT .1 %. THE ASSESSEE HIMSELF HAS OFFERED THE PERCENTAGE OF COMMISSION AT 0.15%, WHICH IS MORE THAN THE PERCENTAGE OF COMMISSION CONSIDERED TO BE REASONABLE BY THE TRIBUNAL IN THE CA SES OF PALRESHA & CO. (SUPRA) AND KIRAN & CO. (SUPRA), IN SIMILAR TYPE OF TRANSACTIONS. THE THEORY OF THE ASSESSING OFFICER TO TREAT THE ENTIRE DEPOSIT AS 'UNEXPLAINED CASH CREDITS, CANNOT BE ACCEPTED IN THE LIGHT OF ASSESSMENT ORDERS IN THE CASE OF BENEFI CIARIES AND ALSO IN THE LIGHT OF THE FACT THAT ASSESSEE IS ONLY CONCERN WITH THE COMMISSION EARNED ON PROVIDING ACCOMMODATION ENTRIES. WE, THEREFORE, OF THE VIEW THAT SINCE THE ASSESSEE ITSELF HAS DECLARED THE COMMISSION ON TURNOVER AT 0.15% WHICH IS MORE THAN THE PERCENTAGE CONSIDERED TO BE REASONABLE BY THE TRIBUNAL IN THE CASES OF PALRESHA & CO. (SUPRA) AND KIRAN & CO. (SUPRA), THE SAME SHOULD BE ACCEPTED. WE, ACCORDINGLY, ACCEPT TH E C OMMISSION DECLARED BY THE ASSESSEE AND SET ASIDE THE ORDER OF THE CIT (A) IN THIS REGARD. 6 .2 WE FIND THAT ITAT IN CASE OF SANJAY KUMAR GARG (SUPRA) HAS APPLIED 0.2% COMMISSION ON TURNOVER AND IN GOLD S TAR FINVEST (P) LTD. (SUPRA) APPROVED 0.15%. SO, T AKING ALL FACTORS INTO CONSIDERATION, WE HOLD THAT PERCENTAGE OF COMMIS SION TO BE EARNED ON TURNOVER IS REASONABLE AT 0.6 %. WE HOLD SO. 6.3 ASSESSING OFFICER HAS ALLOWED ONLY AD HOC EXPENSES @ 5% OF COMMISSION INCOME , WITHOUT PREJUDICE TO MERIT OF ISSUE, WE ARE NOT INCLINED TO INTERFERE IN THE FINDING OF ASSESSING OFFICER O N THIS ISSUE. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 38 7 . NEXT ISSUE IS RAISED BY WAY OF ADDITIONAL GROUND. THE ISSUE IS WITH REGARD TO ALLOWABILITY OF THE DEDUCTION OF REBATE U/S.88 OF THE ACT CLAIMED BY ASSESSEE IN RETURN OF INCOME. ACCORDING TO ASSESSEE, AS PER SECTION 88, ASSESSEE BEING IN DIVIDUAL IS ELIGIBLE FOR CLAIMING THE DEDUCTION @ 20% OF CONTRIBUTION MADE IN PPF & LIC PREMIUM AND OTHER. ASSESSING OFFICER WHILE COMPUTING TOTAL INCOME ESCAPED THE SAID REBATE WITHOUT ANY COMMENT. HENCE, REQUESTED THAT THE REBATE CLAIMED BY ASSESSEE RE QUIRED TO BE ALLOWED AS PER LAW . LOWER AUTHORITIES HAD NO OCCASION TO ADJUDICATE THIS ISSUE BEING TAKEN AS ADDITIONAL GROUND. IN THE INTEREST OF JUSTICE, T HIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH DIRECTION TO ALLOW THE SAME AS PER FACT AND LAW. 8 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 9 . IN ITA NO.5030/MUM/2014 FOR A.Y. 2003 - 04 IN CASE OF RAKESHKUMAR M. GUPTA, ALL GROUNDS ARE SIMILAR TO THAT OF A.Y.2002 - 03. IT IS ONLY STATED THAT ONLY DIFFERENCE INSTEAD OF COMMISSION OF 6% ON SALE, ASSESSING OFFICER COMPUTED THE COMMISSION INCOME @4% ON SALE AND 3% ON PURCHASE. LEARNED AUTHORIZED REPRESENTATIVE SUBMITTED THAT FOLLOWING THE SUBMISSION IN A.Y. 2002 - 03 ISSUE SHOULD BE DECIDED. W E HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 O F THIS ORDER . FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ON SAME LINE I.E. 0.6 % COMMISSION ON TURNOVER IS REASONABLE . ASSESSING OFFICER IS DIRECTED ACCORDINGLY . ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 39 9.1 NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF AD HOC 5% ON COMMIS SION INCOME. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y. 2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 10. NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITION AL GROUND REGARDING DEDUCTION U/S.88 OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS . 1 1 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 1 2 . IN ITA NO.5031/MUM/2014 FOR A.Y. 2004 - 05 IN CASE OF RAKESHKUMAR M. GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER , W E FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF TH IS ORDER WHEREIN WE HELD THAT 0.6 % COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 12.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THI S ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 13. NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.88 OF THE ACT . SIMILAR ISSUE HAS BEEN ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 40 RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 1 4 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 1 5 . IN ITA NO.5032/MUM/2014 FOR A.Y. 2005 - 06 IN CASE OF RAKESHKUMAR M. GUPTA, THE ISSUE OF COMMISSION INCOME ON TURNOVER , W E FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6 % COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 1 5 .1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE P ARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 1 6 . NEXT ISSUE IN ADDITIONAL GROUND NO.8 IS WITH REGARD TO ALLOWABILITY OF DEDUCTION U/S.24 (B) OF THE ACT ON ACCOUNT OF INTEREST PAID ON HOUS ING LOAN. DURING THE YEAR, ASSESSEE OBTAINED HOME LOAN FROM STANDARD CHARTERED BANK AND GE MONEY HOUSING FINANCE AND PAID INTEREST OF RS.1,47,679/ - THEREON CLAIMED THE DEDUCTION OF SAME ON ACCOUNT OF INTEREST ON HO U SING LOAN U/S.24(B) OF THE ACT. HOWEVER , ASSESSING OFFICER ESCAPED THE ABOVE DEDUCTION WHILE COMPUTING THE TOTAL INCOME OF ASSESSEE AND EVEN NOT GIVEN ANY COMMENT FOR ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 41 DISALLOWING THE SAME. ASSESSEE HAD OBTAINED THE FLAT FROM LOAN AND PAID INTEREST THEREON WHICH IS NOT IN DISPUTE. HENCE, INTER EST PAID OF HOUSING LOAN WAS REQUESTED TO BE ALLOWED TO ASSESSEE U/S.24(B) OF THE ACT. THIS ISSUE HAS BEEN RAISED BY WAY OF ADDITION GROUND BEFORE US. AS STATED ABOVE, THIS ISSUE WAS TAKEN BEFORE ASSESSING OFFICER WHO ESCAPED THE ABOVE DEDUCTION WHILE CO MPUTING THE TOTAL INCOME OF ASSESSEE AND EVEN NOT GIVEN ANY COMMENT FOR THE SAME ON MERIT. BEING LEGAL ISSUE, IT CAN BE RAISED BEFORE US. IT IS MAINTAINABLE, SO, SAME IS ENTERTAINED AT THIS STAGE. SINCE ON FACTS THERE IS NO FINDING OF LOWER AUTHORITIES, SO, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH DIRECTION TO DECIDE THE SAME AS PER FACT AND LAW AFTER GIVING OPPORTUNITY OF HEARING TO ASSESSEE. 1 7 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 1 8 . IN ITA NO.5033/MUM/2014 FOR A.Y. 200 6 - 07 IN CASE OF RAKESHKUMAR M. GUPTA, THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6 % COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWI NG SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 18.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING S AME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 42 1 9 . OTHER ISSUE IN ITA NO.5033/MUM/2014 FOR A.Y. 2006 - 07 IS WITH REGARD TO DEDUCTION OF RS.1,40,00,000/ - ADVANCE GIVEN TO MADANLAL BEGRECHA. LEARNED AUTHORIZED REPRESENTATIVE SUBMITTED THAT ASSESSING OF FICER HAS DIS ALLOWED THE DEDUCTION ON GROUND THAT ASSESSEE HAD NOT SUBSTANTIATED THE CLAIM. BUT, ASSESSING OFFICER FAILED TO CONSIDER THAT LOANS ARE OPENING BALANCE WHICH WE RE ACCEPTED IN 2005 - 06 AND FURTHER TO SUBSTANTIATE THE CLAIM ASSESSEE VIDE SUBMI SSION DATED 06.12.2010 STATED AS UNDER (REFER PAGE NO.98 OF PAPER BOOK OF A.Y.2006 - 07): 8. I HAD TAKEN HOME LOAN FROM STANDARD CHARTERED BANK AND GE FINANCIAL. I HAVE CLAIMED IT CORRECTLY AND BEST OF MY KNOWLEDGE. I AM SENDING THE SANCTIONED LETTER ISSU ED BY THE ABOVE MENTIONED BANK WITH THIS LETTER. THE LOAN ACCOUNT NUMBER AND LOAN DETAILS ARE MENTIONED ON IT. THE BANK CERTIFICATE AND INTEREST CERTIFICATE ARE IN THE DOCUMENTS IMPOUNDED BY YOUR DEPARTMENT. I WOULD LIKE TO REQUEST YOU TO COLLECT IT FRO M THERE ITSELF. THE HOUSING LOAN TAKEN IS NOT WRONGLY CLAIMED AND IS IN THE PREVIEW OF INCOME TAX ACT, 1961, SO CANTS BE DISALLOWED. 1 9 .1 ASSESSEE SUBMITTED THAT ASSESSEE HAD PROVIDED ALL THE DETAILS AVAILABLE WITH HIM AND ALSO THE DETAILS ARE LYING WIT H ASSESSING OFFICER. HENCE, ASSESSING OFFICER CAN NOT STATE THAT ASSESSEE FAILED TO SUBSTANTIATE THE CLAIM. SO, THE DEDUCTION CLAIMED BY ASSESSEE IS REQU EST ED TO BE ALLOWED. IN FACT, THIS ISSUE IS WITH REGARD TO DEDUCTION OF RS.1,40,00,000/ - ADVANCE GIVE N TO MADANLAL BAGRECHA TO SUBSTANTIATE SAME . THE STAND OF ASSESSEE HAS BEEN THAT ASSESSEE HAD GIVEN CHEQUES OF RS.1,40,00,000/ - IN J ULY 2006 TO MR. MADANLAL BAGRECHA FOR ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 43 GETTING THE CASH. M R. MADANLALA BAGRECHA DOING THE BUSINESS OF CHEQUE DISCOUNTING. TH ESE CASH W ERE REQUIRED TO BE PAID TO ASSESSEE PURCHASE PARTIES AT BHIWANDI FOR GETTING GOODS PURCHASES. MR . MADANALAL BAGRECHA HA D INTENTIONALLY WITHHOLD THIS AMOUNT FOR WHICH ASSESSEE HAD LODGED AN OFFICIAL COMPLAIN WITH CONCERN POLICE DEPARTMENT AND FINA NCIAL CRIME DEPARTMENT. (REFER PAGE NO.88 TO 91 OF PAPER BOOK ). THUS, IT WA S A BUSINESS LOSS OF ASSESSEE WHICH REQUIRED TO BE ALLOWED TO ASSESSEE . ASSESSING OFFICER AND CIT (A) OBSERVED THAT ASSESSEE HAD GIVEN CASH LOAN OF RS. 1,40,00,000/ - TO SHRI MADAN LAL BAGRECHA AND SOURCE OF SAME WA S UNEXPLAINED. HENCE, THE Y MADE ADDITION OF RS. 1,40,00,000 / - U/ S.69 A OF THE ACT . THE STAND OF ASSESSEE HAS BEEN THAT I T IS A BUSINESS LOSS AND REQUIRED TO BE ALLOWED AND SAME SHOULD NOT BE ADDED BECAUSE ASSESSEE HAD GIVE N ADVANCES IN NORMAL BUSINESS PRACTICE WHICH WAS LOST. HENCE, IT WAS SUBMITTED TO THE CASE WHERE ASSESSEE SUFFERED FROM LOSS. HENCE, IT WA S A BUSINESS LOSS AND REQUIRED TO BE ALLOWED INSTEAD OF MAKING ADDITION OF THE SAME. IN THIS REGARD, ASSESSEE PLACED RELIANCE ON THE DECISION OF VIJAYASHANTHI BUILDERS LTD. V S . JCIT [ 2016 ] 69 TAXMANN.COM 31 (CHENNAI - TRIB.) , W HERE IN ASSESSEE - BUILDER PAID ADVANCE MONEY TO BUY A LAND FOR CONSTRUCTION OF RESIDENTIAL FLATS THEREUPON AND SA ID MONEY WAS FORFEITED, SUCH LOSS WAS TO BE TREATED AS REVENUE LOSS AS IT WAS INCURRED TO ACQUIRE STOCK - IN - TRADE I.E. LAND . EVEN IF , IT IS ASSUME D THAT ASSESSEE NEEDS THIS CASH FOR ACCOMMODATION BUSINESS, THEN ALSO IT IS ALLOWABLE EXPENDITURE AS IT IS DIR ECTLY LINKED WITH THE BUSINESS ACTIVITY ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 44 EVEN THOUGH THE BUSINESS ACTIVITY IS ILLEGAL . LEARNED AUTHORIZED REPRESENTATIVE ALSO RELIED ON THE DECISION OF DR. T. A. QUERESHI VS. CIT [2006] 157 TAXMAN 514 (SC), WHEREIN HEROIN FORMED PART OF STICK - IN - TRADE OF AS SESSEE. IN VIEW OF SAID FINDING, THE TRIBUNAL ALLOWED ASSESSEE'S CLAIM OF DEDUCTING THE LOSS OF 5 KG. OF HEROIN WHOSE VALUE WAS ASSESSED BY THE TRIBUNAL AT RS. 2 LAKHS AS A BUSINESS LOSS. THE VIEW TAKEN BY THE TRIBUNAL WAS SUSTAINED BY HONBLE HIGH COURT B Y TAKING AN EMOTIONAL AND MORAL APPROACH RATHER THAN A LEGAL APPROACH. IN APPEAL, HONBLE HIGH COURT OBSERVED THAT ASSESSEE WAS COMMITTING A HIGHLY IMMORAL ACT IN ILLEGALLY MANUFACTURING AND SELLING HEROIN. HOWEVER, CASES WE RE TO BE DECIDED BY THE COURT ON LEGAL PRINCIPLES AND NOT ON ONE'S OWN MORAL VIEWS. THE EXPLANATION TO SECTION 37 OF THE ACT HAS REALLY NOTHING TO DO WITH THE INSTANT CASE AS IT WAS NOT A CASE OF BUSINESS EXPENDITURE, BUT OF BUSINESS LOSS. BUSINESS LOSSES WERE ALLOWABLE ON ORDINARY COMM ERCIAL PRINCIPLES IN COMPUTING PROFITS. ONCE IT WAS FOUND THAT HEROIN SEIZED FORMED PART OF STOCK - IN - TRADE OF ASSESSEE, IT FOLLOWED THAT THE SEIZURE AND CONFISCATION OF SUCH STOCK - IN - TRADE HAD TO BE ALLOWED AS A BUSINESS LOSS. LOSS OF STOCK - IN - TRADE HAS TO BE CONSIDERED AS A TRADING LOSS. CONSEQUENTLY, THE IMPUGNED DECISION OF HONBLE HIGH COURT COULD NOT BE SUSTAINED AND WAS SET ASIDE AND ORDER OF TRIBUNAL WAS RESTORED. FACTS BEING SIMILAR, SO, TAKING ALL FACTS AND CIRCUMSTANCES INTO CONSIDERATION, WE HOLD THAT ADDITION OF RS.1,40,00,000/ - IS UNJUSTIFIED . S AME SHOULD BE ALLOWED AS BUSINESS LOSS. HOWEVER, SAME WILL BE OFFERED TO TAX ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 45 AS AND WHEN IT IS RECEIVED. ASSESSING OFFICER IS DIRECTED ACCORDINGLY. 20. NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF INTEREST OF HOUSING LOANS OF RS.3,08,719/ - . SIMILAR ISSUE AROSE IN A.Y.2005 - 06, WHICH HAS BEEN DISCUSSED AND RESTORED TO ASSESSING OFFICER BY US VIDE PARA 16 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE RESTORED TO ASSES SING OFFICER WITH SIMILAR DIRECTION. 2 1 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 2 2 . IN 5034/MUM/2014 FOR A.Y.2007 - 08 IN CASE OF RAKESHKUMAR M. GUPTA, THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDE D THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6 % COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 2 2 .1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HA VE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 2 3 . NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF INTEREST OF HOUSIN G LOANS OF RS.1,50,000/ - . SIMILAR ISSUE AROSE IN A.Y.2005 - 06, WHICH HAS BEEN DISCUSSED AND RESTORED TO ASSESSING OFFICER BY US VIDE PARA 16 OF THIS ORDER. FACTS BEING ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 46 SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE RESTORED TO ASSESSING OFFICER WITH SIM ILAR DIRECTION. 2 3 . NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF LONG TERM CAPITAL GAIN. REVENUE AUTHORITIES HELD THAT ASSESSEE FAILED TO FILE THE DETAILS. HENCE, ASSESSING OFFICER TREATED GAIN AS TRADING BUSINESS INCOME. IN THIS REGARD, THE STAND OF A SSESSEE HAS BEEN THAT ALL DETAILS WERE SUBMITTED BEFORE ASSESSING OFFICER AND LONG TERM CAPITAL GAIN CANNOT BE TREA TED AS SHARE TRADING ACTIVITY. DURING YEAR, ASSESSEE EARNED LONG TERM CAPITAL GAIN OF RS.25,625/ - . ASSESSEE HAS NOT GIVEN DETAILS, SO, REVE NUE AUTHORITIES WERE JUSTIFIED IN DISALLOWING THE CLAIM OF ASSESSEE. SAME IS UPHELD. 2 5 . NEXT ISSUE IN THIS YEAR IS WITH REGARD TO TREATING THE SPECULATIVE INCOME AS NORMAL INCOME AND ACCORDINGLY NOT GIVING THE SET OFF OF CARRY FORWARD SPECULATION LOSS. ASSESSING OFFICER HELD THAT ASSESSEE FAILED TO FILE THE DETAILS. SO, HE TREATED THE SPECULATIVE INCOME AS NORMAL INCOME. DURING YEAR, ASSESSEE EARNED THE SPECULATIVE PROFIT OF RS.10,073/ - . ASSESSEE HAS NOT GIVEN DETAILS, SO, REVENUE AUTHORITIES WERE JU STIFIED IN DISALLOWING THE CLAIM OF ASSESSEE. SAME IS UPHELD. 2 6 . NEXT ISSUE AS RAISED BY WAY OF ADDITIONAL GROUND IS WITH REGARD TO NOT ALLOWING THE SHORT TERM CAPITAL LOSS OF RS.8,94,016/ - . ASSESSEE FILED THE DETAILS. ASSESSEE STATED THAT LOSS WAS TA KEN PLACE WHICH IS NOT IN DISPUTE, BUT, ASSESSING OFFICER GOT CONFUSED WHETHER IT IS A SHORT TERM CAPITAL LOSS OR ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 47 TRADING LOSS OR SPECULATIVE LOSS. BUT, ASSESSING OFFICER FAILED TO CONSIDER THAT SHARES WERE ALWAYS SHOWN BY ASSESSEE AS INVESTMENT AND ASSES SED IN PAST ALSO AS INVESTMENT ACTIVITY. HENCE, GAIN IS REQUIRED TO BE ALLOWED AS SHORT TERM CAPITAL LOSS. ACCORDING TO ASSESSEE, ASSESSING OFFICER CANNOT DENY THE LOSS BECAUSE OF CONFUSION. NOW, AS PER CBDT CIRCULAR NO.6 OF 2016 DATED 29.02.2016 INVEST MENT IN SHORT TERM CAPITAL GAIN BE ASSESSED AS SHORT TERM CAPITAL GAIN. BEING LEGAL ISSUE RAISED BEFORE US IN THE LIGHT OF CBDT CIRCULAR, WE ADMIT THIS GROUND AND RESTORE THIS ISSUE TO THE FILE OF ASSESSING OFFICER TO DECIDE THE SAME AS PER FACT AND LAW A FTER PROVIDING DUE OPPORTUNITY OF BEING HEARD TO ASSESSEE. 2 7 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 2 8 . IN ITA NO.5035/MUM/2014 FOR A.Y.2008 - 09 IN CASE OF RAKESHKUMAR M. GUPTA, THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 28.1 NEXT ISSUE IS WITH REGARD TO AD HOC DI SALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 48 2 9 . NEXT ISSUE IS WITH REGARD TO DISA LLOWANCE OF INTEREST OF HOUSING LOANS OF RS.1,50,000/ - . SIMILAR ISSUE AROSE IN A.Y.2005 - 06, WHICH HAS BEEN RESTORED TO ASSESSING OFFICER BY US VIDE PARA 16 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THESE ISSUE S ARE RESTORED TO ASSES SING OFFICER WITH SIMILAR DIRECTION. 30. NEXT ISSUE IN THIS YEAR IS WITH REGARD TO TREATING THE SPECULATIVE INCOME AS NORMAL INCOME AND ACCORDINGLY NOT GIVING THE SET OFF OF CARRY FORWARD SPECULATION LOSS. ASSESSING OFFICER DID NOT ALLOW THIS LOSS. WE H AVE DECIDED SIMILAR ISSUE AGAINST ASSESSEE IN A.Y. 2007 - 08 VIDE PARA 25 OF THIS ORDER. FACTS BEING SIMILAR SO FOLLOWING SAME REASONING THIS ISSUE IS DECIDED AGAINST ASSESSEE. 31 . NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF SHORT TERM CAPITAL LOSS OF RS. 1,24,58,478. SIMILAR ISSUE AROSE IN A.Y.2007 - 08, WHICH HAS BEEN RESTORED TO ASSESSING OFFICER BY US VIDE PARA 26 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THESE ISSUES ARE RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTION. 3 2 . GROUND NO.4 IN A.Y. 200 8 - 09 IS WITH REGARD TO ADDITION OF RS.4,22,432/ - MADE ON ACCOUNT OF CLAIM OF HOUSING LOAN INTEREST. ACCORDING TO REVENUE AUTHORITIES, ASSESSEE FAILED TO FILE THE DETAILS. HENCE, AMOUNT DEBITED IN CAPITAL ACCOUNT AMOUNTING TO RS.4,2 2,432/ - IS NOT ALLOWABLE EXPENDITURE AND ACCORDINGLY SAME WAS ADDED. ACCORDING TO ASSESSEE, ASSESSING OFFICER MADE ADDITION ON ASSUMPTION THAT ASSESSEE HAD ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 49 CLAIMED INTEREST PAYMENT ON HOUSING LOAN. BUT, ASSESSING OFFICER FAILED TO CONSIDER THAT ASSESSEE HAD OBTAINED THESE LOANS IN A.Y. 2005 - 06 AND SAME WAS CARRIED FORWARD AND LOAN WAS TAKEN IN PERSONAL CAPACITY AND INTEREST ON SAME WAS DEBITED DIRECTLY IN CAPITAL ACCOUNT AND NOT CLAIMED IN PROFIT & LOSS ACCOUNT (AS DETAILED IN PAGE NOS. 6 & 17 OF PAPER BO OK FOR A.Y. 2008 - 09). WHEN EXPENSES WERE NOT CLAIMED AT ALL, THEN THE SAME CANNOT BE DISALLOWED. HENCE, THE DISALLOWANCE MADE BY THE ASSESSING OFFICER IS ARBITRARY AND MERE ASSUMPTION . NOW, THE ASSESSEE HAD CLAIMED HOUSE LOAN INTEREST. ASSESSEE CLAIMED INTEREST ON HOUSE LOAN U/S.24(B) OF THE ACT AMOUNTING TO RS.1,50,000/ - WHICH IS ALREADY DISALLOWED BY ASSESSING OFFICER, HENCE, BY DISALLOWING THE INTEREST DEBITED IN CAPITAL ACCOUNT LEAD TO DOUBLE TAXATION WHICH IS AGAINST THE LAW OF TAXATION. HENCE, REQ UESTED THAT DISALLOWANCE MADE BY ASSESSING OFFICER BE DELETED. ACCORDING TO THE CONTENTION OF ASSESSEE, WHEN EXPENSES WERE NOT CLAIMED AT ALL, THEN SAME COULD NOT BE DISALLOWED. AGREEING TO THE CONTENTIONS OF ASSESSEE WE DO NOT FIND THAT ADDITION IN QUES TION IS NOT JUSTIFIED. SAME IS DIRECTED TO BE DELETED. 32 .1 REGARDING INTEREST ON HOUSING LOAN U/S.24(B) OF THE ACT OF RS.150,000/ - OUT OF RS.4,22,432/ - . SIMILAR ISSUE DISCUSSED AND DECIDED BY US IN GROUND NO.8 OF A.Y.200 6 - 0 7 VIDE PARA 20 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTION. 3 3 . ADDITIONAL GROUND NO.13 IN THIS YEAR IS WITH REGARD TO TREATING THE DIVIDEND INCOME OF RS.18,400/ - AS TAXABLE INCOME. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 50 REVENUE AUTHORITI ES OBSERVED THAT ASSESSEE FAILED TO FILED THE DETAILS. HENCE, DIVIDEND IS TAXABLE UNDER THE HEAD OTHER SOURCE. THE STAND OF ASSESSEE IS THAT AS PER SECTION 10(33) OF THE ACT DIVIDEND INCOME CANNOT BE TAXABLE. IN PRESENT CASE, ASSESSING OFFICER HAS NOT DISPUTED THAT THE INCOME WAS DIVIDE N D. HE JUST WANTS THE DETAILS WHICH WERE ALREADY IN HIS POSSESSION. ACCORDING TO REVENUE AUTHORITIES, ONE THING IS CLEAR THAT ASSESSEE HAD INVESTED IN SHARES AND SECURITIES WHICH WERE NOT IN DISPUTE AND ALL THE SHARES WERE LISTED SHARES OF COMPANY. HENCE, IT CANNOT BE IMAGINED THAT DIVIDEND RECEIVED FROM INDIAN COMPANY WAS TAXABLE. THEREFORE, IT WAS REQUESTED TO ALLOW THE EXEMPTION U/S.10(33) OF THE ACT AND TREATED THE DIVIDEND INCOME AS EXEMPT. 33.1 IN THIS BACKGROU ND, WE ARE OF THE VIEW THAT THIS ISSUE NEEDS TO BE ANALYSED IN THE FACTS OF THE CASE AS PRAYED BY ASSESSEE. SO, THE MATTER IS RESTORED TO ASSESSING OFFICER WITH DIRECTION TO DECIDE THE SAME AS PER FACT AND LAW AFTER PROVIDING DUE OPPORTUNITY OF BEING HEAR D TO ASSESSEE. 3 4 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 3 5 . IN ITA NO.5036/MUM/2014 FOR A.Y. 2009 - 10 IN CASE OF RAKESHKUMAR M. GUPTA, THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 51 35.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED A ND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 3 6 . NEXT GROUND IN THIS YEAR IS SIMILAR TO ADDITIONAL GROUND NO.10 OF A.YS. 2007 - 08 & 2008 - 09. ONLY DIFFERENCE IS THAT EARLIER LOSS AMOUNT WAS RS. 8,94,016/ - & 1,24,58,478/ - RESPECTIVELY AND NOW THE LOSS WAS RS. 99,78,290/ - . SIMILAR ISSUE AROSE IN A.Y. 2007 - 08, WHICH HAS BEEN RESTORED TO ASSESSING OFFICER BY US VIDE PARA 26 OF THIS O RDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THESE ISSUES ARE RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTION. 3 7 . NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF INTEREST OF HOUSING LOANS OF RS.1,50,000/ - . SIMILAR ISSUE AROSE IN A.Y.2005 - 06 , WHICH HAS BEEN RESTORED TO ASSESSING OFFICER BY US VIDE PARA 16 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THESE ISSUES ARE RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTION. 3 8 . NEXT GROUND IN THIS YEAR IS WITH REGARD TO NOT A LLOWING THE DEDUCTION OF CHAP TER VI - A OF RS.30,185/ - . SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECT IONS. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 52 3 9 . IN ITA NO.5037/MUM/2014 FOR A.Y.2009 - 10 IN CASE OF RAKESHKUMAR M. GUPTA (HUF) , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURN OVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 39.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 40 . NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION UNDER CHAPTER VIA OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US T O ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 41 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 42 . IN ITA NO.5019/MUM/2 014 FOR A.Y.2008 - 09 IN CASE OF NILESH RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 53 COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 42.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMI LAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 43. NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION UNDER CHAPTER VIA OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 4 4 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 4 5 . IN ITA NO.5020/MUM/2014 FOR A.Y.2009 - 10 IN CASE OF NI LESH RAKESHKUMAR , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, I SSUE IS DECIDED ACCORDINGLY. 45.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 54 BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 46. NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION UNDER CHAPTER VIA OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, S O FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 47. AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 4 8 . IN ITA NO.5021/MUM/2014 FOR A.Y.2002 - 03 IN CASE OF MOH I T RAKESHKUMAR GUPTA , THE ISSUE OF COM MISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 48. 1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE . 49. NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.88 OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 55 FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RE STORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 50. AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 51 . IN ITA NO.5022/MUM/2014 FOR A.Y.2003 - 04 IN CASE OF MOHIT RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 51 .1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLO WANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 52 . NEXT ISSUE HAS BEEN TAKEN BY WAY OF AD DITIONAL GROUND REGARDING DEDUCTION U/S.88 OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRE CTIONS. 5 3 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 5 4 . IN ITA NO.5023/MUM/2014 FOR A.Y.2004 - 05 IN CASE OF MOHIT RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 56 COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 54.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DE CIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 5 5 . NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.88 O F THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 5 6 . AS A RESULT, APPEAL FILED BY AS SESSEE IS PARTLY ALLOWED. 5 7 . IN ITA NO.5024/MUM/2014 FOR A.Y.2005 - 06 IN CASE OF MOHIT RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% C OMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 57.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 57 5 8 . NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.88 OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 5 9 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 60 . IN ITA NO.5025 /MUM/2014 FOR A.Y.2006 - 07 IN CASE OF MOHIT RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS B EING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 60.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 61 . NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.80C OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VI DE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 58 62 . NEXT ISSUE IS REGARDING INTEREST ON HOUSING LOAN U/S.24(B) OF THE ACT OF RS.1,29,066 / - . SIMILAR ISSUE DISCUSSED AND DECI DED BY US IN A.Y.200 5 - 0 6 VIDE PARA 16 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTION. 6 3 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 6 4 . IN ITA NO.5026/MUM/2 014 FOR A.Y.2007 - 08 IN CASE OF MOHIT RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD TH AT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING S IMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 64 .1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMIL AR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 65. NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF INTEREST OF HOUSING LOANS OF RS.1,50,000/ - . SIMILAR ISSUE AROSE IN A.Y.2005 - 06, WHICH HAS BEEN DISCUSSED AND RESTORED TO ASSESSING O FFICER BY US VIDE PARA 16 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTION. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 59 6 6 . NEXT GROUND IS WITH REGARD TO TREATING THE DIVIDEND INCOME OF RS.26,391/ - AS TAXABLE INCOME. S IMILAR ISSUE AROSE IN A.Y. 08 - 09 VIDE PARA NO.30.1. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING WE ARE OF THE VIEW THAT THIS ISSUE NEEDS TO BE ANALYSED IN THE FACTS OF THE CASE AS PRAYED BY ASSESSEE. SO, THE MATTER IS RESTORED TO ASSESSING OFFICER WI TH DIRECTION TO DECIDE THE SAME AS PER FACT AND LAW AFTER PROVIDING DUE OPPORTUNITY OF BEING HEARD TO ASSESSEE. 6 7 . NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.80C OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASS ESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 6 8 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 6 9 . IN ITA NO.5027/MUM/2014 FOR A.Y.2008 - 09 IN CASE OF MOHIT RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMIL AR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 69 .1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 60 BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 70 . NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF INTEREST OF HOUSING LOANS OF RS.1,50,000/ - . SIMILAR ISSUE AROSE IN A.Y.2005 - 06, WHICH HAS BEEN DISCUSSED AND RESTORED TO ASSESSING OFFIC ER BY US VIDE PARA 16 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTION. 7 1 . NEXT ISSUE IS R EGARDING INTEREST ON HOUSING LOAN U/S.24(B) OF THE ACT OF RS.1,88,870/ - . SIMILAR IS SUE DISCUSSED AND DECIDED BY US IN GROUND NO.8 OF A.Y.2006 - 07 VIDE PARA 20 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTION. 72 . NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.80C & 80D OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIREC TIONS. 73 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 7 4 . IN ITA NO.5028/MUM/2014 FOR A.Y.2009 - 10 IN CASE OF MOHIT RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 61 COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 74.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DEC IDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 7 5 . NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.80C O F THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 7 6 . AS A RESULT, APPEAL FILED BY A SSESSEE IS PARTLY ALLOWED. 7 7 . IN ITA NO.501 1 /MUM/2014 FOR A.Y.2002 - 03 IN CASE OF HEMA RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% C OMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 77.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 62 78. NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.88 & 88B OF THE ACT. SIMILAR ISSUE HAS BEEN RESTO RED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 7 9 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 80 . IN ITA N O.501 3 /MUM/2014 FOR A.Y.200 3 - 0 4 IN CASE OF HEMA RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FA CTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 80.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 81. NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.88 & 88C OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 63 8 2 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 83 . IN ITA NO.5012/MUM/2014 FOR A.Y.2004 - 05 IN CASE OF HEMA RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REA SONING, ISSUE IS DECIDED ACCORDINGLY. 83.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONI NG, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 84. NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.88 & 88C OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILA R, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 8 5 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 86 . IN ITA NO.5014/MUM/2014 FOR A.Y.2005 - 06 IN CASE OF HEMA RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 64 COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 86.1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSES SEE. 87. NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.88 & 88C OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS IS SUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 8 8 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 8 9 . IN ITA NO.5015/MUM/2014 FOR A.Y.2006 - 07 IN CASE OF HEMA RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 8 9 .1 NEXT ISSUE IS WITH REGARD TO AD HO C DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 65 BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 90 . NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.80C & 80D OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER W ITH SIMILAR DIRECTIONS. 91 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 92 . IN ITA NO.5016/MUM/2014 FOR A.Y.2007 - 08 IN CASE OF HEMA RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED TH IS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 92 .1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE D ISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 93. NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DED UCTION U/S.80C & 80D OF THE ACT. SIMILAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 66 THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 9 4 . AS A RES ULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 9 5 . IN ITA NO.5017/MUM/2014 FOR A.Y.2008 - 09 IN CASE OF HEMA RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHERE IN WE HELD THAT 0.6% COMMISSION ON TURNOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 9 5 .1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINS T ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6.3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 96 . NEXT ISSUE HAS BEEN TAKEN BY WAY OF ADDITIONAL GROUND REGARDING DEDUCTION U/S.80C & 80D OF THE ACT. SIMI LAR ISSUE HAS BEEN RESTORED BY US TO ASSESSING OFFICER IN A.Y. 2002 - 03 VIDE PARA 7. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS RESTORED TO ASSESSING OFFICER WITH SIMILAR DIRECTIONS. 9 7 . AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTL Y ALLOWED. 9 8 . IN ITA NO.5018/MUM/2014 FOR A.Y.2009 - 10 IN CASE OF HEMA RAKESHKUMAR GUPTA , THE ISSUE OF COMMISSION INCOME ITA NO S.5029 TO 5036 / MUM /1 4 & 19 OTHERS [ RAKESHKUMAR M. GUPTA & 4 OTHERS VS. ITO ] PAGE 67 ON TURNOVER, WE FIND THAT WE HAVE DISCUSSED AND DECIDED THIS ISSUE IN PARA 6 OF THIS ORDER WHEREIN WE HELD THAT 0.6% COMMISSION ON TUR NOVER IS REASONABLE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ISSUE IS DECIDED ACCORDINGLY. 9 8 .1 NEXT ISSUE IS WITH REGARD TO AD HOC DISALLOWANCE OF EXPENSES. WE HAVE DISCUSSED AND DECIDED THIS ISSUE AGAINST ASSESSEE IN A.Y.2002 - 03 VIDE PARA 6. 3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THIS ISSUE IS DECIDED AGAINST ASSESSEE. 9 8 . 2 AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 9 9 . IN THE RESULT, ALL A PPEAL S FILED BY ASSESSEE ARE PARTLY ALLOWED AS INDICATED AB OVE. PRONOUNCED IN THE OPEN COURT ON THIS THE 14TH DAY OF SEPT , 201 6 . SD SD ( RAJESH KUMAR ) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI : DATED 14 / 09 /201 6 S.K.SINHA / COPY OF ORDER FORWARDED TO: - 1 . / REVENUE 2 . / ASSESSEE 3 . / CONCERNED CIT 4. - / CIT (A) 5 . , , / DR, ITAT, MUMBAI 6 . / GUARD FILE. BY ORDER / , / , ,