TaxTMI 
TaxTMI 
2017 (11) TMI 2087
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.... the estimation of commission income @ 0.26% in the facts and circumstances of the case. 3. Brief facts of the case are that the assessee is a private limited company and is a commission agent and filed its return of income showing total income of Rs. 3,18,200/- on 16-02-2012. Notices u/s. 143(2) and 142(1) of the Act were issued. In response to said notices, the assessee appeared and filed details. A search and seizure operation in the case of M/s. Electro Steel Casting and in the case of Sadbhav Group was conducted, wherein it was admitted that M/s. Silicon Real Estate and assessee have made accommodation entry for claiming bogus commission as expenses. Likewise, M/s. Montecarlo Construction Ltd has also admitted that it used to d....
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....the assessee company to its beneficiaries. In view of above, it was pleaded by the assessee company that the AO be directed to restrict the addition on account of undisclosed commission income @ 0.15% in place of 0.50% as adopted by the AO. 5. The CIT-A after considering the above directed the AO to recalculate the total assessed income by adopting the rate of commission @ 0.26% of turnover as against 0.50% by the AO. Relevant portion of the CIT-A order is reproduced herein below for better understanding:- 5. I have considered the submission of the appellant and perused the assessment order. It is observed that there is no dispute on the fact that the only activity of the appellant company was to provide accommodation entries of....
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....by applying the rate not more than 0.15% because the margin of the company was ranging from 0.10% to 0.15% only as stated before the AO. During the course of appellate proceedings it is observed by me that the same AO has made assessment in another case named as M/s Safeco Projects Pvt. Ltd. u/s 143(3) of the Act on 27.03.2013 for the A.Y. 2011-12. In that case also, the AO had received information from the ACIT, CC-I, Ahmedabad that the said company was providing accommodation entries to Ahmedabad based company M/s Mote Carlo Construction Ltd. In the case of M/s Safeco projects Pvt. Ltd. also, the AD recorded the statement of the director of that company u/s 131 of the Act and in that statement the director of the company admitted commissi....
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....ed. " 6. The ld.AR reiterated his same submissions as made before the CIT-A. On the other hand, the ld.DR relied on the order of the AO. 7. Heard both the parties and perused the record. We find that there is no dispute that the assessee company provided accommodation entries. We find that Shri Sumit Sharma, one of the director of the assessee company in his statement u/s. 131 of the Act admitted that the assessee company indulged in the activity of providing the accommodation entries. We find that the facts of the present case are similar to the facts in the case of Safeco Projects Pvt. Ltd in ITA No. 1948/Kol/2014 for the A.Y: 2010-11, since the net profit shown @ 0.26% was more than the 0.10% to 0.15%, which was admitted by th....