TaxTMI 
TaxTMI 
2025 (12) TMI 290
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..../2025, have been taken into account consideration for deciding these two appeals en-masse. 3. The Grounds of appeal raised by the assessee in ITA 524/Rjt/2025 for Assessment Year 2017-18, are follows; "1. The Ld. CIT(A) erred in law as well as on fact in upholding profit rate of 10% without any basis and disregarding comparative cases. 2. The Ld. CIT(A) erred in law as well as on fact in upholding an addition of Rs. 18,67,044/- made by Ld. AO u/s 69A of the Act." 4. Brief facts of the issue in dispute are stated as under. The assessee before us is an individual and had not filed his return of income for the assessment year (A.Y.) 2017-18. The assessee is engaged in purchasing and selling of brass components on commission basis. As per the information there are total credits of Rs. 1,95,82,197/-, which were observed by the assessing officer, during F.Y. 2016-17 in the bank accounts of the assessee with the ICICI bank bearing nos. 072605000749, 072601504936 and 072605500333. The assessee`s case was opened for re-assessment u/s 147 of the Act after getting approval. Accordingly, notice u/s 148 of the Act dated 21/04/2021 was issued in assessee`s case. In respon....
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....icer. However, while filing Income Tax return in response to Notice u/s 148 of the Act, assessee declared net of profit of Rs. 4,65,910/-. Therefore, the difference Rs. 18,67,044/- (Rs.23,32,954- Rs. 4,65,910) was added back to the total income of the assessee on account of undisclosed business income. 6. Aggrieved by the order of the assessing officer, the assessee carried the matter in appeal before the Ld. CIT(A), who has confirmed the action of the assessing officer. During the course of appellate proceedings, before the learned CIT(A), the assessee filed sample invoices and other details authenticating existence of business. The assessee also gave some comparable instances of profitability in the same line of business. However, even though, the assessee had done such huge business transactions, but did not bother to maintain books of accounts / audit the books of accounts/file Return of Income which shows grave negligence. Even though, substantial cash deposits/credits in the bank accounts of ICICI Bank were from business transactions, it is not possible to make one-to-one correlation at this juncture. Therefore, the addition made by the AO i.e., treating 10% of cash deposi....
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.... and the withdrawals have been made at Jamnagar and assessee, therefore, requested the assessing officer to treat the credits in the bank account, as a total turnover of the assessee, in order to make a reasonable estimation of net profit. However, the assessing officer has not made reasonable estimated addition. However, on appeal by the assessee, the ld.CIT(A) estimated the profit at the rate of 5% for assessment year 2013-14 and estimated the profit at the rate of 10% in assessment year 2014-15 and other assessment years. The assessee is in appeal before us, raising the main grievance that addition sustained by the learned CIT(A) in various assessment years, varies from 5% to 10%, whereas the assessee is a commission agent and earning only commission at the rate of 2% of the amount deposited in the bank account/ turnover. Therefore, learned Counsel for the assessee, prayed the Bench that estimated addition should be sustained at the rate of 2% of the turnover, taking into account the trading activities of the assessee and the industry norms. Considering the above facts, we find that assessing officer has not denied this fact that assessee is not a commission agent. The assessing....
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....sh deposited/credits in bank accounts and should be taxable under the normal rate of Income-tax. 12. In the result, the appeal of the assessee, in ITA No. 524/Rjt/2025 for AY 2017- 18, is partly allowed, in above terms. 13. Now, we shall take assessee`s appeal in ITA No.529/RJT/2025, ( Penalty appeal under section 271A of the Act). I note that issue under consideration in respect of penalty, under section 271A of the Act, is also squarely covered by the order of Co-ordinate Bench of ITAT, Rajkot in assessee's own case in ITA No. 510,511,512, 517, 518, 527 and 530/Rjt/2025 for AY 2013-14 to 2015-16, wherein the findings of the Tribunal are as follows: "37. Now we shall take, remaining penalty appeal of the assessee in ITA, No.511/Rjt/2025, for A.Y. 2013-14, Penalty u/s. 271A of the Act, on account of non-maintenance of books of accounts. We note that the above penalty was imposed by the assessing officer, on account of failure to keep, maintain or retain books of accounts, documents etc. If any person fails to keep and maintain any such books of account and other documents as required by section 44AA of the Act or rules made thereunder, then the assessing officer may ....