TaxTMI 
TaxTMI 
2026 (1) TMI 549
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.... Brief facts of the case is that the assessee is an individual engaged in the business of wholesale trading in Feed and Maize Products for cattle food. Assessee filed his Return of Income for the Asst. Year 2013-14 on 21-09-2013 declaring total income of Rs. 5,36,545/-. Regular assessment was completed u/s. 143(3) of the Act on 31-08-2015 assessing the total income at Rs. 6,38,616/-. Subsequently the case was reopened on the ground that the credits and debits entries reflecting in the bank account no. 5111500003258 held by the assessee in Nutan Nagrik Sahkari Bank were reported as suspicious. As per the bank statement substantial credits from M/s. Anil Group of Companies were transferred on the same day to other companies of the same group. It is seen that Rs. 1,15,00,000 received from M/s Anil Tradecom Ltd was transferred to Anil Bioplus, Anil Nutrients and Anil Products on the same day. Such daily transactions were frequently appearing in the bank statement. As per ROC data, Anil Tradecom Limited was a trader in maize and its products. However, M/s Anil Bioplus Limited (ABL) was engaged in manufacturing and marketing of Enzymes (supplying to Textile, Food & Beverages, and Paper i....
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....ement of commission income accrued to the assessee. In our humble view the entire amount of credit entries cannot be added to the taxable income of the assessee ignoring the debit side entries and as when the assessee is receiving cash and issuing cheques then said cheque of almost same amount then the assessee cannot be held beneficiary of entire amount or entire amount of credit entries treating the same as unexplained. 4.2.3 As per above discussions, the appellant had facilitated accommodation entry through bank account routing. Once the debit and credit side of bank account is taken together, then only a very small amount remained which was the element of commission income accrued to the assessee. The appellant was showing only 0.03% as net profit. The jurisdictional ITAT, Ahmedabad bench has held in order dated 28/09/2022 in the case of Nexus Software Ltd in Appeal Number: ITA No.1821/Ahd/2015 that, we do not find any infirmity in the findings of the Id. CIT(A) that the assessee is an entry provider only and was involved in accommodation entry business and has been rightly taxed at 0.5% for commission income on the deposits in the bank account. In the case of Arydeep ....
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..... 4. The assessment proceedings u/s. 143(3) of the Act was passed by the AO assessing total income of Rs. 6.38.616/- and thereafter the learned AO had passed order u/s. 143(3) r.w.sec. 147 of the Act finalizing by making addition of Rs. 4,53,14,285/- being 8% of total turnover of Rs. 59,64,28.565/- and thereafter the order passed by the Hon. CIT (A) determining total income of 34,28,782/- being 2% commission of total credits of Rs. 17,41,39,105/-appearing in credit side of NUTAN NAGRIK CO. OP.BANK A/c. No. 5111500003258 considering the credit transactions in the said bank as alleged mere accommodation entries and on the wrong footing as hereunder and also the Order passed u/s. 147 of the Act by the learned AO as well as the Hon. CIT (A) u/s. 250 by the presents this appeal against the same on the following amongst other grounds: i) The amounts credited in NUTAN NAGRIK CO. OP BANK A/c. No. 5111500003258 of the assessee which were reported suspicious. ii) The assessee failed to provide confirmation letter from the parties to whom purchase and sales was made during the year under consideration. iii) Mere filing of ledger accounts and cash and bank b....
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....t controverted or disproved by the AO by bringing some material on record, the onus which lay on the assessee stood discharged and the addition made could not be sustained. 9. The Learned AO has erred in law and in facts in initiating the penalty proceedings u/s. 271 of the Income Tax Act, 1961. 10. The learned AO has erred in charging interest u/s. 234B of the I.T. Act. 11. Your appellant prays to leave to add, amend, modify, cancel and/or substitute all or any of the grounds before the final hearing of the appeal with the permission of the Hon'ble appellate authority. 5. Ld. Counsel Shri M.K. Patel appearing for the assessee in support of the grounds raised before us submitted that the 2% estimation made by the Ld. CIT(A) is not correct, considering the admitted net profit of 0.03% declared by the assessee. Therefore requested to modify the order passed by Ld. CIT(A). 6. Per contra Ld. D.Rs. appearing for the Revenue supported the order passed by Ld. CIT(A) and requested to confirm the addition made by the Ld. CIT(A). 7. We have given our thoughtful consideration and perused the materials available on record. Though the grounds of appeal ar....