SAANVI DEVELOPERS & REALTORS PVT. LTD., KOLKATA,KOLKATA vs. I.T.O., WARD - 4(1), KOLKATA, KOLKATA

The only issue raised by the assessee in ground nos. 2 to 5, is against the confirmation of addition by the ld. CIT (A) as made by the ld. AO on account of commission at the rate of 1% on the total turnover which ought to have been made / reduced by the ld. CIT (A) to 0.10% to 0.15% of the total turnover.

The ld. DR on the other hand relied on the order of the authorities below, however, fairly conceded the point that the Tribunal has passed an order in assessee’s own case in A.Y. 2010-11 with the same facts.

After hearing the rival contentions and perusing the materials available on record, we find that admittedly the assessee was engaged in providing accommodation entries on commission basis. The assessee filed the return of income on 20.03.2013 by declaring total income at ₹1,13,730/-. Thereafter, the case of the assessee was selected for scrutiny and assessment was completed on 31.03.2015, assessing the total income at ₹23,96,493/- after making an addition of ₹22,93,619/- on account of undisclosed commission at the rate of 1% for providing accommodation entries. Thereafter, notice u/s 148 of the Act was issued which was complied with by the assessee by filing the return of income on 15.06.2017 with a total income of ₹3,59,470/-. The ld. AO completed the assessment on an income of ₹27,55,969/- by making an addition of ₹23,96,493/- as in respect of undisclosed income. According to the ld. AO, the assessee has provided the accommodation entries totaling to ₹23,96,49,307/- and accordingly, the addition at the rate of 1% was made which worked out to 23,96,493/-. The said order was challenged before the ld. CIT (A), however, the ld. CIT (A) confirmed the finding of the ld. Assessing “8. I have also gone through the judgment passed by the Hon’ble Bombay High court in the case of PCIT vs Alag Securities Pvt. Ltd placed by the assessee where in the order passed by the ITAT Mumbai Bench “A” was upheld by observing thus-“Tribunal held that the action of the Assessing Officer in treating the entire deposits as unexplained cash credits could not be accepted in the light of the assessement orders in the case of the beneficiaries and also in the light of the facts that the assessee was only concerned with the commission earned on providing accommodation entries. Therefore, the tribunal took the view that since the assessee had itself declared the commission on turnover at 0.15% which was more than percentage considered to be reasonable by the tribunal, the same should be accepted.