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Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT
Before: SHRI WASEEM AHMED & MS. SUCHITRA RAGHUNATH KAMBLE
आदेश / O R D E R
PER WASEEM AHMED, ACCOUNTANTMEMBER:
1. This is an appeal filed at the instance of the assessee against the order of the ld. CIT(A)-1, Rajkot passed u/s 250 of Income-tax Act, 1961 on 31.07.2015 for the Assessment Year 2007-08.
The assessee has raised the following grounds of appeal:
The Grounds appeals mentioned hereunder are without prejudice to one another.
The learned Income-tax Officer, Ward-1 (2)(4), Rajkot as well as the Commissioner of Income Tax (Appeals) - 1, Rajkot has erred in law as well as on facts in determining the income on estimate basis @ 1.25% of total turnover i.e. Rs. 6,65,02,364/-.
2. The learned Income-tax Officer, Ward-1 (2)(4), Rajkot as well as the Commissioner of Income Tax (Appeals) - 1, Rajkot has erred in law as well as on facts in determining the turnover of the appellant as well as the amount of income which is chargeable to tax.
3. The learned Income-tax Officer, Ward-1 (2)(4), Rajkot as well as the Commissioner of Income Tax (Appeals) - 1, Rajkot has also erred in law as well as on facts in not considering the fact that appellant has incurred loss commission which he has confirmed on oath before the assessing officer, in a statement recorded u/s 131(1 A) of the Act.
The learned Income-tax Officer, Ward-1 (2)(4), Rajkot as well as the Commissioner of Income Tax (Appeals) - 1, Rajkot has erred in law as well as on facts in determining the real income of the appellant and the fact that the appellant has incurred loss has not been considered the income is estimated @ 1.25 % without citing-any comparables cases.
5. The learned Income-tax Officer, Ward-1 (2)(4), Rajkot as well as the Commissioner of Income Tax (Appeals) - 1, Rajkot has erred on facts as well as in law while charging interest u/s. 234A, 234B, 234C & 234D of the Act. Your Honour’s appellant craves to leave to add, amend alter or withdraw any or more grounds of appeal before the hearing of this appeal.
None appeared on behalf of the assessee. But the assessee has filed a Written- Submission which we have perused and considered. Shri Ajai Pratap Singh, Ld. D/R appeared on behalf of Revenue.
4. The facts in brief are that the assessee is an individual engaged in share- broking business. The AO took action u/s 148 in response to which the assessee submitted return declaring a total income of Rs. 1,65,437/-. The Ld. AO completed assessment at a total income of Rs. 6,57,77,057/- after making an addition of Rs. 6,56,11,620/-. Against the order of AO, the assessee filed appeal to Ld. CIT(A) who allowed part-relief by restricting addition to 1.25% of 6,65,02,364/- [the figure of Rs. 6,56,11,620/- assessed by Ld. AO was modified to Rs. 6,65,02,364/- by Ld. CIT(A)]. Still being aggrieved by the order of Ld. CIT(A), the assessee filed appeal before this ITAT. Now the assessee is before us.
In Ground No. 1 to 4, the assessee has challenged the addition of 1.25% of Rs. 6,65,02,364/- sustained by the Ld. CIT(A). In the Written-Submission, the assessee has brought to our notice that the exactly same issue arose in the case of his own case in the immediately preceding Assessment Year (i.e. AY 2006-07), wherein this Hon’ble Bench in Order dated 08.09.2016 has restricted the addition to 0.50% of the turnover instead of 1.25%. The relevant findings of the order is reproduced as under:
We have given a thoughtful 'consideration to the orders of the authorities below, considering the factual matrix as discussed hereinabove, since the revenue authorities have accepted that the assessee was in fact doing share broking business then, in our considered
More so, when the revenue authorities themselves have mentioned that income from commission/brokerage on account of share trading normally ranges from 0.115% to 0.50%. Once this range has been accepted by the lower authorities, we do not find; any reason/logic in estimating the commission income @ 1.25%. Even, if the assessee has not maintained any books of accounts that does not mean that the assessee has earned more profit then made by the share brokers in this line of business. We, accordingly, modify the findings of the Id. CIT(A) and direct the A.O. to restrict the addition by taking the commission earned @ 0.5%. This grievance of the Assessee is partly allowed.
The Ld. DR before us has also not brought anything on record contrary to the submission of the ld. AR.
On this basis, the assessee has fairly prayed to accept 0.50%, as upheld by this Hon’ble ITAT. As the issue is squarely covered in assessee’s own case, we accept this pray of the assessee and direct the Ld. AO to restrict the addition to 0.50%. Therefore, the Grounds are partly allowed.
The ground no.5 raised by the assessee is consequential in nature therefore the same is dismissed accordingly.
Ground No. 6 is general in nature and therefore does not require any adjudication.
In the result, the appeal filed by the assessee is partly allowed.