AMANKUMAR BIRMARAM PRAJAPAT,SURAT, GUJARAT vs. INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH, DELHI

ITA 3794/MUM/2026Status: DisposedITAT Mumbai08 October 2026AY 2013-147 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the addition of ₹7,75,672 as commission income is unsustainable. The Tribunal distinguished between the existence of accommodation entries and the identity of the person who earned the commission attributed to them. It found that while the entries might have been routed through concerns controlled by the Bhanwarlal Jain Group, this alone did not establish that the assessee personally earned commission. The assessment order lacked material showing the assessee received separate commission or that commission was paid to him in addition to what was assessed in Shri Bhanwarlal Jain's hands. The Tribunal noted that the transactions were the same as those considered in Shri Bhanwarlal Jain's substantive assessment. Sustaining the same commission stream again in the assessee's hands would duplicate the assessment made in the hands of the principal operator. The Tribunal also referred to its own order in Shri Bhanwarlal M. Jain v. DCIT, where the commission estimate for accommodation entries of bogus purchases was reduced from 0.075% to 0.05%. Since the addition in the assessee's hands failed for want of evidence of him earning a separate commission, the addition was deleted. The remaining grounds were rendered infructuous.

What were the facts?

The assessee, Amankumar Birmaram Prajapat, filed an appeal against the order of the CIT(A), NFAC, for Assessment Year 2013-14. The appeal challenges an addition of ₹7,75,672, representing commission income estimated by the Assessing Officer (AO) at 0.075% of alleged accommodation entries aggregating to ₹103,42,29,339. The AO's action stemmed from information received during a search in the Bhanwarlal Jain Group, indicating accommodation entries routed through concerns operated by that group and transactions shown in the assessee's name. The assessee claimed his PAN was misused by his employer, Manav Diamonds Pvt. Ltd., and denied receiving any commission. The CIT(A) upheld the addition, finding the assessee's involvement established by the Investigation Wing's information and the group's modus operandi, distinguishing it from the assessment in Shri Bhanwarlal Jain's hands.

What were the issues?

1. Whether the addition of ₹7,75,672 as commission income, estimated at 0.075% of alleged accommodation entries aggregating to ₹103,42,29,339, is sustainable in the hands of the assessee for Assessment Year 2013-14, turning on the interpretation of Section 68 of the Income Tax Act, 1961, and the evidentiary nexus required to attribute commission income. Assessee's contentions: The commission income arising from the accommodation entries has already been substantively assessed in the hands of Shri Bhanwarlal Jain. The assessee's name and PAN were used by his employer without his knowledge, and there is no evidence of him receiving separate commission or deriving independent benefit. The Tribunal, in Shri Bhanwarlal Jain's case, reduced the estimated commission rate from 0.075% to 0.05% for similar accommodation entries. Revenue's contentions: The learned Departmental Representative relied upon the orders of the authorities below.

Which sections of the Income-tax Act were involved?

Section 68

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Income Tax Appellate Tribunal, ‘SMC’

For Appellant: Shri Nikhil Natekar
For Respondent: Ms. Jayshree Thakur, SR AR
Hearing: 07/10/2026Pronounced: 08/10/2026

PER AMIT SHUKLA (J.M): This appeal by the assessee is directed against the order dated 30 January 2026 passed by the learned Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, for Assessment Year 2013–14. The principal grievance is against the addition of ₹7,75,672, being commission income estimated by the Assessing Officer at 0.075% of alleged

2 Amankumar Birmaram Prajapat accommodation entries aggregating to ₹103,42,29,339. The assessee contends that the very commission income arising from these transactions has already been assessed substantively in the hands of Shri Bhanwarlal Jain and that, in any event, the Tribunal has determined a lower rate in its order i

The order continues below.

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