2012 (10) TMI 1197

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....rother of Shri Pravin Kumar Jain. The assessee has filed ereturn of income on 30-09-2008 declaring total income of Rs. Nil. However, the assessment was completed at an income of ₹ 62,85,950/- vide assessment order dtd. 31-12-2010 passed u/s 143(3) of the Act. On appeal the ld. CIT(A) partly allowed the appeal. 3. Being aggrieved by the order of the ld. CIT(A) the assessee and the Revenue both are in appeal before us. ITA No. 6037/Mum/2011 (By assessee) 4. All the grounds taken by the assessee are against the rejection of book results u/s 145(3) of the Act and sustenance of addition. 5. The assessee vide letter dtd. 8-10-2012 has also filed additional ground of appeal that the ld. CIT(A) erred in confirming the disallowance of ₹ 40,42,634/-. 6. The assessee for the admission of the additional ground of appeal relied on the decision of the Hon'ble Supreme Court in the case of National Thermal Power Co. vs. CIT (1998) 229 ITR 383 (SC). 7. We have carefully considered the submission of the rival parties and perused the material available on record. Larger Bench of the Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. (supra) observed that the quest....

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..... 9 and its answer as below: Q.9. I am showing you the following business concerns empty letter head papers which are found during the course of search action u/s. 132 at your premises No. 512, C-Wing, Ostwal Onyz Bldg., Bhayander. Please explain the same. 8) Shah Industries 9) H. Vinay & Co. 10) New planet Trading Co. Pvt. Ltd. 11) Diamond Star 12) Kanak Gems Rs,13) P.P. Impex 14) N.R. Corporation Ans. In the above company names I have been giving accommodation bills in the years 2003,2004 and 2005 to various parties like Arihant Corporation, Antrix Diamond, Jaypee Textile, Tirupati Synthetics etc. Gosalia Diamond, Mumbai. All this transaction were made through following banks: 4) A.P. Mahesh Co.Op. Bank Bhuleshwar, Mumbai 5) ABN AMRO bank-Fort, Mumbai 6) Union Bank of India, Kalbadevi, Mumbai The a/c Nos are not in my memory right now, I will furnish in two days time. From your above statement and from this statement it is clear that you are not doing any business except providing accommodation bills to the parties. Please offer your comment. There is no answer from Shri Prqavin Kumar Jain for 10 minutes. Q. No.10. I am asking th....

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....l in Group concern of the assessee M/s Easy Mercantile Pvt. Ltd. vs. DCIT in ITA No. 6035/Mum/2011 for A.Y. 2008- 09 and M/s SBJ Trading (I) Pvt. ltd. vs. DCIT in ITA No. 6038/Mum/2011 for A.Y. 2008-09 vide order dtd. 27-7-2012, therefore, the addition/disallowance sustained by the ld. CIT(A) be deleted. 11. On the other hand, the ld. D.R. while relying on the order of the A.O. strongly relied on the answer to question No. 9 of the statement dtd. 31-3-2008 and answer to question No. 9 & 10 of the statement dtd. 17-5- 2008 of Shri Pravin Kumar Jain and the material found during the course of search. He further submits that for the reasons as mentioned in the assessment order, the income estimated by the A.O. is more than reasonable, therefore, the relief allowed by the ld. CIT(A) be reversed and that the addition made by the A.O. be restored. 12. We have carefully considered the submissions of the rival parties and perused the material available on record. We find that the facts are not in dispute inasmuch as it is also not in dispute that the Tribunal in the case of M/s Easy Mercantile Pvt. Ltd. (supra) after considering the similar questions and answers given by Shri Pravin Kuma....

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....cepted. The Ld. CIT(A) has erred in confirming this assessment. As we have held that commission income is not assessable in the hands of the assessee, its return as per account is accepted and the addition made with respect to commission is deleted. As the returned income has been accepted, the additional ground raised by the assessee for allowability of expenses against commission has become infructuous, therefore need not be adjudicated separately". 13. In the absence of any distinguishing feature brought on record by the ld. D.R., we respectfully following the consistent view of the Tribunal and keeping in view that the ld. D.R. has not brought on record any new material which has not been considered by the Tribunal (supra) we are of the view that the estimated addition made by the A.O. at 1% of the total turnover without bringing any supporting material on record and reduced by the ld. CIT(A) to 0.5% without any basis is not sustainable in law and accordingly we hold that the commission income is not assessable in the hands of the assessee and, hence, we delete the addition sustained by the ld. CIT(A) in this regard. Since we have deleted the entire addition made by the A.O. ....