2026 (6) TMI 855

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....the assessee filed its return of income declaring total income of Rs. 24,68,980/-. Subsequently, the case was selected for scrutiny and notices u/s. 143(2) and 142(1) of the Income Tax Act, 1961 ('the Act') were issued calling for necessary information and documentation. The AO stated that the assessee-company is one of the group companies of Shri Shirish C. Shah in whose case, a search u/s. 132 of the Act was carried out in the year 2013, wherein it was found that he was the main person engaged in providing bogus accommodation entries like Long Term Capital Gain, share capital with huge share premium, turnover, loan etc. and he directly/indirectly controlled many companies including the assessee-company and thereafter referring to the sale....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....s of the AO and against the said order, the assessee is in appeal before us. 3. During the course of hearing, the Ld.AR submitted that the assessee company during the year under consideration had shown a turnover of Rs. 90,36,25,872/-, which was held to be bogus turnover. Further, the investment made by the company during the year under consideration was also held to be bogus and commission income @1% was assessed by the AO and confirmed by the Ld.CIT(A). Further, our reference was drawn to the trading results of the assessee-company, wherein it has reported Gross Profit of Rs. 65,35,962/. It was submitted that the AO despite holding the turnover of the assessee-company to be bogus has accepted Gross Profit so declared and therefore, the....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....AO that there is no correlation is wholly based on surmises, presumptions and conjectures without any evidence contrary to the claim of the assessee. 5. It was further submitted that AO while completing the assessment did not allow credit of self-assessment tax paid of Rs. 5,98,200/-. In this regard, our reference was drawn to Form-26AS as part of assessee's paper book and it was submitted that the self-assessment tax stand duly reflected in Form-26AS and, therefore, the AO may be directed to allow credit of self-assessment tax duly paid by the assessee. 6. Per contra, the Ld.DR is heard, who has relied on the order passed by the AO. It was submitted that no doubt the Tribunal in the assessee's own cases for earlier years has allowed ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....on. 9. We have heard the rival contentions and perused the material available on record. The findings of the Assessing officer that the assessee is not engaged in any actual business activity but involved in circular transactions are not in dispute before us. Further, it is also an accepted position that commission income @ 1% should be assessed on the reported turnover along with new investments made during the year. The assessee has reported a turnover of Rs. 90,36,25,872 and has reported profits of Rs. 22,67,943/- as per books of accounts and basis that, has reported tax profits of Rs. 24,68,980/- in its return of income filed for the impugned assessment year 2017-18. The AO while holding the turnover to be bogus has computed commissi....