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Income Tax Appellate Tribunal, “B” BENCH, MUMBAI
Before: SHRI M BALAGANESH & SHRI PAVAN KUMAR GADALE
Appellant by : Shri Sashi Tulsiyan. AR Respondent by : Shri Sanjiv Jain. DR Date of Hearing 15.11.2021 Date of Pronouncement 23.11.2021 आदेश / O R D E R
PER PAVAN KUMAR GADALE JM:
The assessee has filed the appeal against the order of the Commissioner of Income Tax (Appeals)-47, Mumbai passed u/s 143(3) and 250 of the Act. The assessee has raised the following grounds of appeal:
1. The Learned Assessing Officer erred in assessing the income of the assessee at Rs. 59,82,980/- instead of Rs. 48,27,400/- as per the Return of Income and the CIT(A) -47 erred in giving only part relief 2. The learned assessing officer erred in relying on the order of A Y 2010-11 and A Y 2013-14 in the para 5 and 5.1 of the assessment order without considering the fact that the Bijal Ashok Shah, Mumbai - 2 - assessment order of A Y 2010-11 has been deleted by the ITAT while deciding the case in favour of assessee and the CIT(A) 47 erred in also holding that the ITAT had not given any finding on merits, ignoring the finding of the ITAT that there was no evidence against the assessee.
The Learned Assessing Officer and the CIT(A) 47 erred in making additions to the income of the assessee without taking into consideration, the documents (including third party confirmations and vat returns) and explanations provided by the assessee to prove the genuineness of the transactions and that there was no evidence against the assessee.
4. The Learned Assessing Officer and the CIT(A)-47 erred in stating that there was no evidence that there was mental harassment and pressure from the department by personnel visiting assesse's premises u/s 133 A, inspite of the Assessee's Chartered Accountant, Assessee's father and Assessee's wife confirming misbehavior, harassment and coercion before the assessing office and the CIT(A)-47.
5. The Learned Assessing Officer and CIT(A)-47 erred in making additions to the income of the assessee by Rs. 11,55,580/- on the basis of the statement recorded during the Survey u/s 131 of the Act (in the course of Survey) through coercion and threat and in spite of the statement having been retracted, completely ignoring the torture and harassment to the assessee and his family.
6. The Learned Assessee and CIT(A)-47 have erred in making the additions by completely ignoring and misinterpreting the order passed by the ITAT in favour of the assessee on similar facts pertaining to A.Y. 201011, completely ignoring the principles of judicial discipline.
7. The Learned Assessing Officer and CIT(A)-47 erred in not following the binding decision of ITAT, Mumbai in assessee's own case.
Bijal Ashok Shah, Mumbai - 3 - 8. Without prejudice to the above grounds of appeal
, the CIT(A)-47 erred in adjudicating a ground which was not pressed/withdrawn by the assessee vide letter dated 25th Oct 2020 filed with the CIT(A) – 47
9. The appellant craves leave to add, amend, alter and delete any of the above grounds of appeal.
2. The Brief facts of the case are that, the assessee is a proprietor and is engaged in the business of manufacturing of jewellary and also bullion trader. The assessee has filed the return of income electronically for the A.Y. 2017-18 on 05.10.2017 with a total income of Rs.48,51,310/-, subsequently the assessee has filed a revised return of income on 05.10.2017 with a total income of Rs.48,27,400/-. The return of income was processed u/s 143(1) of the Act. Whereas, the survey operations was conducted on the premises of the assessee on 14.01.2017 and the statement was recorded. The case was selected for scrutiny under the CASS. During the survey operations, the assessee has admitted that he has done some cash transactions with the parties to retain commission. The A.O. has issued notice u/s 142(1) of the Act on 09.12.2019 calling for various details referred at Para 4 of the assessment order. In Bijal Ashok Shah, Mumbai - 4 - compliance, the assessee has furnished the details and explained the sale transactions and the software package for verification of entries.
3. The assessee has filed a letter on 16.12.2019 explaining the transactions with the documentary evidence. The assessee has mentioned that for the A.Y 2011-12 to 2014-15, the CIT(A) has restricted the disallowance to 0.13% of the bogus purchases. Whereas for A.Y 2010-11, the Honble ITAT has completely deleted the addition on account of commission income. The A.O. dealt on the statement recorded during the survey proceedings and also the retracted statement filed by way of an affidavit. Finally the A.O considered the order of the CIT(A) for the A.Y 2011-12 to 2014-15 and has restricted the addition to 0.13% of total transactions which work out to Rs.11,55,584/- and assessed the total income of Rs.59,82,980/- and passed the order u/sec143(3) of the Act dated 25-12-2019.
4. Aggrieved by the order, the assessee has filed an appeal with the CIT(A). Whereas, the CIT(A) has Bijal Ashok Shah, Mumbai - 5 - considered the grounds of appeal, findings of the assessing officer and the submissions of the assessee and has restricted the estimation of income and granted partial relief in other grounds of appeal and partly allowed the appeal. Aggrieved by the CIT(A)order, the assessee has filed an appeal with the Honble Tribunal.
5. At the time of hearing the Ld. AR submitted that the CIT(A) has not considered the decision of the ITAT in the assessee own case and also supported the submissions with the judicial decisions and prayed for allowing the appeal. Contra, the Ld. DR supported the order of the CIT(A)..
We have heard the rival submissions and perused the material on record. Prima-facie, the sole disputed issue envisaged by the Ld.AR that the CIT(A) has erred in restricting the estimation of income and also overlooking the Hon’ble Tribunal decision for earlier years in the assessee own case. Whereas, the Ld. DR relied on the order of the CIT(A) and explained that the CIT(A) took a reasonable view. At this Juncture,
Bijal Ashok Shah, Mumbai - 6 - we considered it appropriate to refer the Hon’ble Tribunal decision on the disputed issue in the assessee’s own case for the A.Y 2011-12 to 2013-14 dated 22.06.2021 at page 3 Para 7 to 9 of the order which is read as under:
7. After hearing both the parties and perusing the material on record particularly the decision of the co-ordinate bench of the Tribunal in A.Y. 2010-11 dated 24.07.2019, we find that the similar issue has been decided in the earlier year the operative part whereof is reproduced as under: “3. I have heard the rival contentions and gone through the facts and circumstances of the case. I noted that a survey action u/s. 133A of the Act, was carried on the premises of the assessee on 14-01-2017. During the survey proceedings the assessee admitted that he has done cash transactions with some of the parties to retain some on commission, but later on retracted his treatment stating that the statement taken by the Investigating Wing during survey was through coercion and threat. The assessee filed an affidavit on 24- 01-2017 i.e. immediately after the survey. There are various allegations of coercion and threat and counter allegations by both the sides. I am not going to all these allegations. But I have gone through the orders of the Assessing Officer and that of the CIT(A). I also heard both the sides now and I am of the view that the Assessing Officer has merely estimated the commission income @ 0.5% of the alleged entries of sale and purchase of Rs. 1,52,11,694/-. The Assessing Officer estimated the commission at Rs.76,060/-. The CIT(A) reduced the estimation at Rs.20,000/- by observing as under:- “7.4 In view of the facts as discussed above, there is no dispute with “E “entries amounting to Rs.1,52,11,964/-. However, the commission income earned on such entries as Bijal Ashok Shah, Mumbai - 7 - computed by the AO @ 0.5% at Rs.76,060/- is without any basis. In this regard, the admissions and disclosures by the assessee at the time of survey in reply to question No. 25 (as pointed out in para 6.2.1(3) that he has earned commission approximately at Rs.6,000/- per Rs. 1 crore of transaction is held to be most fair and reasonable estimation in the absence of any other fair basis. However, since it is only an estimation, the commission income is estimated at Rs. 20,000/- from such business of commission.”
From the above, it is clear that there is no basis for estimating the commission and even the alleged statement was retracted by the assessee by filing the said affidavit on 24-01-2017. The peculiar nature of the case and due to smallness of quantum of addition, I am of the view that in the absence of any evidences, the addition so restricted by CIT(A) is hereby deleted.
In the result, the appeal of the assessee is allowed.”
8. We note that in the survey conducted on 14.01.2017 under section 133A on the business premises of the assessee 4 years were covered i.e. A.Y. 2010-11 to 2013- 14. In all these years the addition was made towards commission on cash transactions as admitted by the assessee during the course of recording of statement under section 133 of the Act which has been retracted subsequently on 24.01.2017. We note that the co-ordinate bench of the Tribunal has already decided the appeal of the assessee in A.Y. 2010-11 as stated above which involved similar issue. We, therefore, respectfully following the same, set aside the order of Ld. CIT(A) and direct the AO to delete the addition.
Accordingly, the appeal of the assessee is allowed.
We find the facts of the present case are similar and identical to earlier years and the addition made by the A.O. on the same statement recorded during the survey,
Bijal Ashok Shah, Mumbai - 8 - which cannot be disputed. We respectfully follow the ratio of the decision and judicial precedence and set aside the order of the CIT(A) on this disputed issue and direct the Assessing officer to delete the addition and allow the ground of appeal in fovour of the assessee.
In the result, the appeal filed by the asseseee is allowed.
Order pronounced in the open court on 23.11.2021