TaxTMI 
TaxTMI 
2018 (9) TMI 419
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....90/Del/2017 for assessment year 2013-14, the factual matrix emanating from orders below are that the assessee had filed the original return of income on 20. 7. 2013 declaring an income of Rs. 2, 20, 815/- which was processed u/s 143(1) of the Income Tax Act, 1961 (hereinafter called 'the Act'). A search & seizure action u/s 132 of the Act was carried out in Dua group of cases including the assessee on 25. 4. 2014. The assessee was a close associate of Dua brothers and handled all unaccounted cash sale/purchase of metal business of Dua group apart from his own business in the name of firm M/s Kewal Metals. During the course of search various incriminating documents were found and seized and statements of various persons were also recorded. Accordingly, a notice u/s 153A of the Act was issued on 16. 5. 2016 requiring the assessee to file the return of income. In response to the notice, the assessee, vide letter dated 8. 8. 2016, furnished the copy of return of income e-filed u/s153A on 3. 6. 2016 declaring an income of Rs. 24, 61, 850/-. The difference of Rs. 22, 41, 035/- due to additional income of Rs. 23, 16, 150/- was declared under the head "business or profession" in the return....
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....an the sum declared by the appellant. The assessee has to take responsibility for his statements as the assessee is not coerced into conceding any position. In this matter, the income from commission on trading of metal on behalf of Mr. Pawan Due is to be estimated. The AO has proceeded to estimate on the basis of statement of the appellant and adopted the figure at Rs. 1 per Kg. However I find that a statement of Sh. Pawan Dua was also recorded on 24. 6. 2014 u/s 132(4) of the Act wherein he stated as under: "Q. No. 5 If Sh. Himanshu Kohli was having the business relations with you, if yes then produce the activities of the same. Ans. Yes. Himanshu Kohli is selling my goods on commission basis and the ratio of the said commission is 25-30 paise per kgs. " The critical and material fact here is the statement of the assessee whereby he has given certain explanation about rate of commission earned by him. In view of the factual statement, I find it prudent to uphold the order of the assessing officer in respect of the commission earned by him. The statement of other party shall not impact as the assessee has already stated his earnings in this regard. Furth....
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....ppreciated the statement recorded on 26. 4. 2014 but has overlooked the reply dated 26. 12. 2016 in the course of assessment proceedings. It was contended that commission was received from Sh. Pawan Dua, who in his statement recorded on 24. 6. 2014 u/s 132(4) of the Act, had stated that the assessee was selling goods on commission @ 25-30 paise per kg. Reliance was placed by the Ld. Counsel on letter dated 24. 6. 2014 and statement dated 24. 6. 2014 u/s 132(4) of the Act. It was prayed that the average rate of commission @ 0. 50 paise per kg be accepted and addition made by adopting the commission @ Re. 1 per kg may kindly be deleted. 4. On the other hand, the Ld. CIT DR relied upon the orders of the authorities below and requested that estimation of income from commission from trading of metals of the assessee be rejected. In the written submissions filed by the department, it was stated as under: " It is humbly submitted that the following decisions may kindly be considered with regard to validity of statement recorded u/s 132(4) of I. T. Act. : 1 Kishore Kumar v CIT (62 taxmann. com 215, 234 Taxman 771) (Copy enclosed) Where Hon'ble Supreme Court dismissed S....
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....on was found to differ from it. In the facts and circumstances of the case, having regard to the material on record, the appellant had failed to establish that the statements of its partner had been recorded in the course of search by using coercion, threat or inducement. Hence, the contentions advanced by the appellant in that regard were dismissed and the conclusion of the Tribunal on that count was affirmed. " [Para 9] 6 Raj Hans Towers (P) Ltd. v. CIT [56 taxmann. com 67, 230 Taxman 567, 373 ITR 9) where Hon'ble Delhi High Court held that were assessee had not offered any satisfactory explanation regarding surrendered amount being not bona fide and it was also not borne out in any contentions raised before lower authorities, additions so made after adjusting expenditure were justified (SURVEY CASE) 7 PCIT v. Avinash Kumar Setia [2017] 81 taxmann. com 476 (Delhi) where Hon'ble Delhi High Court held that where assessee surrendered certain income by way of declaration and withdraw same after two years without any satisfactory explanation, it could not be treated as bonafide and, hence addition would sustain (SURVEY CASE)" 5. We have heard the rival su....
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.... 71. 5 paisa 10% 7. 15 Rs. 2. Brass 250 per kg 0. 30 75 paisa 10% 7. 5 Rs. 3. Zinc 100 per kg 0. 47 47 paisa 80% 37. 6 Rs. Total 52. 25 6. 23. 4 Thus, from the aforesaid tabulation, it would be evident that the average rate of commission is 50 paisa per kg and the income declared may kindly be accepted as such. 6. 23. 5 Should your goodself require any evidence to verify the above submission, the assessee is willing to furnish the same though it is submitted that the aforesaid computation of commission was done at the behest of the Investigation Wing and no doubt, it is on estimated basis and average rates were adopted to work out the estimate real income of the assessee having regard to the nature of involvement of assessee and the assets founds in the course of search including cash and stock. " 5. 3 We also note that the Ld. CIT (Appeals) has also noted that the assessee has claimed that no defect was pointed out in the order of assessment in the above estimation by the assessee. Moreover, it is a matter of fact and undisputed that what is being estimated ....
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....No 2 relates to addition of Rs. 15, 00, 000/- on account of commission income from MCX dabba trading for the instant assessment year. During the instant year, the assessee had also earned commission on MCX dabba trading and having regard to the seized documents the assessee had offered commission of Rs. 7, 50, 000/- by adopting the rate of Rs. 500/- per crore of trade value. In the course of search, statement on one Shri Gagan Arora was recorded and deposed that the rate of commission income on such trading is Rs. 2000/- per crore of trading value and as such the income was determined at Rs. 30, 00, 000/- and consequently addition was made of Rs. 22, 50, 000/-. The Ld. CIT (Appeals) restricted the same to Rs. 1500/- per crore of trading value and the assessee has challenged the said determination. 7. 0 Before us it was contended by the Ld. Counsel that no material has been led to support the above estimation at Rs. 1500/- per crore. It was stated that the statement of Sh. Gagan Arora could not be relied upon in absence of cross examination, despite having specifically sought so in the assessment proceedings. 8. 0 On the other hand, the Ld. CIT DR relied upon the order of the ....