TaxTMI 
TaxTMI 
2015 (7) TMI 841
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....ome of Rs. 1,15,000/-. The assessee's case was selected for scrutiny through CASS and notice u/s 143(2) of the Income-tax Act, 1961 (hereinafter 'the Act') was issued on 06.08.2009. Subsequently, a notice u/s 143(2) of the Act was issued on 19.01.2010, fixing the case for 01.02.2010. In response to the notice, the assessee himself appeared and was asked to file the details of his income and financial transaction during the financial year. Subsequenlty, notices u/s 142(1) of the Act along with the detailed questionnaire were served on the assessee but these notices were remained uncomplied with. In view of the non-compliance of the notices, the AO issued show cause notice u/s 271(1)(b) and the assessee replied the same with partial details as per the questionnaire. Before the AO, the assessee submitted that he was having only one Bank account with the Bank of Baroda. The AO informed the assessee that as per AIR information, the assessee was having an account with Punjab National Bank, Circle Office, Rajendra Bhawan, Rajendra Place, New Delhi and a total amount of Rs. 2,46,25,891/- was deposited in cash in the said bank account and the copy of the same was given to the assessee. The ....
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....he assessee. The AO, after going through the banks details and the statement recorded by the assessee, observed as follows :- "(i) Sh. Sandeep Sharma (assessee) is proprietor of M/s Om Weighing India for which no income was returned. The assessee is also one of the two Directors in M/s Pro Ion Marketing Pvt. Ltd. and M/s Ja Gang Plastics(India) Private Limited. The assessee in his answer to Question Nos.13 & 14 denied having known the other directors of the above companies. (ii) He has deposited total amount of Rs. 4,29,98,561/- 90 % of which is in cash in the bank account maintained with PNB, Scope Tower, Laxmi Nagar, New Delhi by him in the name of M/s Om Weighing India, his proprietary concern. The evidence is obtained from the bank and is placed on records. (iii) He has transferred almost whole of the amount by cheques to M/s Prolon Marketing Pvt. Ltd. and M/s Ja Gang Plastics (India) Private Limited in which he is director. (iv) Despite providing with more than sufficient opportunities the assessee didn't reveal the source of funds amounting to Rs. 4,29,98,561/- in his account in the PNB. (v) He has no explanation to offer about the source of the funds and t....
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....n companies M/s Prolon Marketing Pvt Ltd. and M/s Ja Gang Plastics (India) Pvt. Ltd. These two companies then give cheques to beneficiaries, who have given cash to the appellant for getting entry through banking channel. In the process, the appellant gets commission @ 0.25% to 0.5% or more in cash, which is his profit or income from business of providing entry to those people. The issue involved here is identical with the issue of Shri Manoj Agrawal & Bemco Jewellers Private Ltd (BJPL) which had been decided by ITAT Special Bench Delhi, in 2008. Now the Jurisdictional Delhi H.C. had passed an interim order in the case of Manoj Agrawal reported in 2011-TIOL-645-HC-DEL-IT vide order dt. 30.09.2011. The jurisdictional High Court is yet to decide the case after getting relevant papers books from both the parties i.e. revenue and the appellant Sh.Manoj Aggarwal & Others. The ITAT had accepted the commission @ 50 paise to Rs. 100 and allowed further deduction of 15 paisa for expenses on maintenance of staff, traveling to bank and others place and other office expenses. I have discussed the matter with the appellant and his AR, persuaded them to estimate the commission income at Re.1 pe....
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....rused the material on record. We find that the Assessing Officer made the addition of Rs. 4,29,98,561/- u/s 68 of the Act, on the ground that the assessee was not able to furnish the explanation regarding the nature and source of cash and other deposits and held the amount as unexplained. We find that the ld. CIT (A) has simply accepted the admission of the assessee that he was providing accommodation entry for commission @ 0.25% to 0.50% or more in cash and that being his profit or income should only be taxed and not the entire amount deposited in his bank account. Ex-consequenti, ld. CIT (A) estimated the income of the assessee @ Rs. 1/- per Rs. 100/- and calculated the income as Rs. 4,39,985/- along with other income of assessee which is reflected in his return. The Revenue is aggrieved by the said impugned order of the ld. CIT (A). In this case, we find that the AO issued first notice dated 06.08.2009. Pursuant to it, ld. AR of the assessee, Shri Pawan Kedia appeared on 24.12.2009 and thereafter, we find that several notices/ questionnaire were issued to the assessee/AR, who did not bother to respond. Only after show cause notice u/s 271(1)(b) was issued on 01.07.2010, the asse....