BLUERAY TRADING PVT. LIMITED,THANE vs. THE DY. CIT, CENTRAL CIRCLE-1(1), AHMEDABAD

Facts

The assessee's original assessment was reopened under Section 148, leading to an addition of Rs. 6.70 crores under Section 68 for alleged bogus share capital/premium. Subsequently, the Pr. CIT passed an order under Section 263, setting aside the reassessment and directing the AO to examine and add 5% commission expenses, amounting to Rs. 33.50 lakhs, for availing these accommodation entries. The AO made this addition, which was later confirmed by the CIT(A).

Held

The Tribunal noted that the primary issue of the Rs. 6.70 crores addition for accommodation entries had previously been remanded to the CIT(A) for fresh adjudication in a related appeal. Since the addition of commission expenses was consequential to this underlying issue, the Tribunal restored the matter of commission expenses back to the CIT(A) for fresh adjudication.

Key Issues

Whether the addition of estimated commission expenses for alleged accommodation entries is justified when the primary addition for accommodation entries itself has been remanded for fresh adjudication by the appellate authority.