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Facts
The assessee filed his return of income declaring Rs.34,20,479/-. A proceeding under Section 147 was initiated for providing accommodation entries and earning undisclosed commission income. The Assessing Officer determined the total commission at Rs.41,79,679/-. The CIT(A) allowed the assessee's appeal.
Held
The Tribunal held that the CIT(A) was correct in deleting the addition of Rs. 41,79,679/- as commission income. The Tribunal noted that in subsequent assessment years, the commission was accepted at 10% of TDS. Therefore, the same rate should apply for the assessment year 2011-12.
Key Issues
Whether the commission income earned by the assessee was correctly calculated and treated, especially in light of previous acceptances at a lower rate.
Sections Cited
147, 148, 250, 153A, 143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH KOLKATA
Before: Shri Rajesh Kumar & Shri Pradip Kumar Choubey
Assessment Year: 2011-12 DCIT, Kolkata ……………………………………….…………….…….……Appellant vs. Ravi Kumar Newatia…..…………………………...………...……...…..…..Respondent 29/13, Doveland Court Ballygunge Park, Kol- 19. [PAN: ABQPN6532P] Appearances by: Shri S. B. Chakraborthy, Sr. DR, appeared on behalf of the appellant. Shri Miraj D. Shah, AR, appeared on behalf of the Respondent. Date of concluding the hearing : October 08, 2025 Date of pronouncing the order : October 28, 2025 ORDER
Per Pradip Kumar Choubey, Judicial Member:
This appeal filed by the revenue is directed against the order dated 14.08.24 of the CIT(A)-21, Kolkata [‘CIT(A)’] passed under Section 250 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for the assessment year 2011–12. The appeal has been filed by the revenue with a delay of 76 days.
The revenue has filed a petition for condonation of the delay. After considering the reasons cited in the petition for condonation of delay, we find that the reasons are valid and consequently, the delay in filing the appeal is hereby condoned and we proceed to dispose of the appeal on merits.
Brief facts of the case are that the assessee filed his return of 3. income for the year under consideration was filed declaring a total income of Rs.34,20,479/-. A proceeding u/s 147 of the Act was initiated considering the fact that the assessee has provided accommodation entries in the form of bogus unsecured loans, share premium through the paper/shell companies created by him and earned commission income which has not disclosed. Subsequently, notice u/s 148 of the Act was issued and in response to the said notice, the assessee filed return of income. The Assessing Officer found that in lieu of providing accommodation entries, the assessee got commission from the beneficiaries. The assessee submitted a letter dated 11.04.2018 where he accepted the same and furnished disclosure petition of commission income earned from Supersonic & Jhunjhunwala Group for the period from 01.04.2021 to 31.03.2017. The Assessing Officer found that the assessee has earned TDS amount as commission in lieu of providing bogus loan and commission @ 0.10% on share application money and determined the total commission of the assessee at Rs.41,79,679/-.
Aggrieved by the said order, the assessee preferred an appeal before the ld. CIT(A) wherein the appeal has been allowed.
Aggrieved and dissatisfied, the revenue has come in appeal before us by taking the following grounds of appeal:
6. Contrary to that, the ld. AR submits that the assessee filed a disclosure before the DDIT(Inv.) Unit 6 for the period 2010-2017 and later on rectified the same before the same unit submitted on 15.10.2018 in which the assessee rectified the commission earned and the same was accepted by the DDIT(Inv.) Unit 6, Kolkata. The ld. AR submits that during the course of block assessment proceedings for the assessment year 2012-13 to 2017-18, the same facts were presented before the ACIT, Central Circle 3(4), Kolkata where the commission was disclosed to the tune of 10% of TDS amount and the same was duly accepted by the Assessing Officer and passed the assessment order accordingly. The ld. AR submits that the ld. CIT(A) has passed the order in view of the acceptance of the TDS amount and hence there is no infirmity in the impugned order. The ld. AR submits the following details which had already been filed before the lower authorities:
1. Assessment order passed u/s 153A/143(3) of the Income Tax Act 1961 for A.Y 2012-13 dated 06.12.2019 2. Assessment order passed u/s 153A/143(3) of the Income Tax Act 1961 for A.Y 2013-14 dated 06.12.2019 3. Assessment order passed u/s 153A/143(3) of the Income Tax Act 1961 for A.Y 2014-15 dated 06.12.2019 4. Assessment order passed u/s 153A/143(3) of the Income Tax Act 1961 for A.Y 2015-16 dated 06.12.2019 5. Assessment order passed u/s 153A/143(3) of the Income Tax Act 1961 for A.Y 2016-17 dated 06.12.2019 6. Assessment order passed u/s 153A/143(3) of the Income Tax Act 1961 for A.Y 2017-18 dated 06.12.2019 7. Upon hearing the submissions of the counsels of the respective parties, we find that the Assessing Officer did not accept the revised calculation of additional commission income offered by the assessee wherein the commission earned @10% of the TDS amount. It is pertinent to mention here that while calculating the amounts, a mistake was committed and whole TDS amount on interest on unsecured loan was declared as commission inadvertently by the assessee. Thereafter, the assessee has submitted a letter before the DDIT(Inv.) wherein the assessee informed the commission income earned on unsecured loan was incorrectly calculated and the revised calculation of commission for the assessment year 2011-12 and 2012-13 was being submitted wherein the commission was calculated on 10% of the TDS. Since in all the block assessment years it has been accepted by the Assessing Officer that commission on unsecured loan was earned by the assessee @10% of the TDS amount, the commission on unsecured loan for the assessment year 2011-12 ought to be charged at the same rate. The ld. CIT(A) in his order has also held as under:
7.1 Keeping in view the above discussion, we do not find any infirmity in the order of the ld. CIT(A) and the same is upheld.
In the result, the appeal of the revenue is dismissed.
Kolkata, the 28th October, 2025.