Assessee fails to prove commission claim on undisclosed deposits, addition upheld for lack of evidence

The ITAT Nagpur upheld the addition of commission income from undisclosed bank deposits. The assessee claimed receiving amounts via three cheques, retaining commission and paying the remainder to two sellers through banking channels. However, the AO and CIT(A) found the assessee's affidavit self-serving and unsupported by proof. Signatures on receipts didn't match sale deed signatures, and the assessee failed to produce the two persons for examination despite summons being issued. The CIT(A) correctly concluded that no satisfactory explanation was provided to support the claim that the added amount was paid to sellers rather than retained as commission income. The appeal was dismissed.

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Issues involved:
The judgment involves appeals filed by the assessee against the order passed by the Commissioner of Income Tax (Appeals) for assessment years 2007-08 and 2008-09.

Issue 1: Addition on account of commission income for A.Y. 2007-08
The assessee challenged the action of CIT(A) in confirming the addition made by the AO on account of commission income. The AO added Rs. 6,00,000 to the total income of the assessee based on the sale of property and commission received. The CIT(A) upheld the addition after considering evidence and explanations provided by the assessee.

The assessee derived income from commission and agriculture. The AO issued a notice u/s. 148 as no return of income was filed for A.Y. 2007-08. The assessee filed a return declaring income, and during the assessment proceedings, was asked to produce various details including bank statements and proof of deductions. The AO added Rs. 6,00,000 to the total income of the assessee based on commission received for the sale of a property.

The CIT(A) considered additional evidence provided by the assessee, including receipts endorsed by the sellers. However, the CIT(A) found the evidence to be self-serving and not supported by proof. The CIT(A) confirmed the addition made by the AO, stating that the appellant failed to produce the concerned persons for verification and did not provide satisfactory explanations for the transactions.

The AO attempted to verify the transactions by issuing summons, but they could not be served due to incorrect addresses. The assessee claimed that the burden of verification lay with the AO. The CIT(A) noted that no steps were taken to produce the concerned persons for verification, and the assessee failed to provide sufficient evidence to support the claim that the added amount was paid to the sellers and not received as commission.

The Tribunal upheld the CIT(A)'s decision, stating that no satisfactory explanation was provided by the assessee. The appeal challenging the addition on account of commission income for A.Y. 2007-08 was dismissed.

Issue 2: Similarity in facts for A.Y. 2008-09
The facts for A.Y. 2008-09 were found to be identical to A.Y. 2007-08, with the only difference being the amount involved. The Tribunal applied the findings from the appeal for A.Y. 2007-08 to the appeal for A.Y. 2008-09 and dismissed the assessee's appeal.

In conclusion, both appeals of the assessee were dismissed based on the findings for A.Y. 2007-08, as the facts were similar for A.Y. 2008-09 as well.

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