TaxTMI 
TaxTMI 
2025 (5) TMI 2320
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....Y. 2018-19) 3. The assessee has raised the following grounds of appeal: "1. The FAA i.e, CIT(A)-54 Mumbai erred in not accepting the additional ground filed before CIT(A) -54 Mumbai. Additional Ground is reproduced hereunder :-4th Additional Ground- In view of Ground No 5 in the Original Grounds of Appeal we would like to add that A.O erred in coming to conclusion that Appellant is connected with SVP Group on whose premises Search took place on 22.08.2017 as far as this financial year is concerned. A.O erred in adopting the percentage of estimation on turnover of sales and purchase which is not the case in this year. 2. The FAA i.e, CIT(A) erred in directing the A.O in restricting the estimation@ 1% on bogus trading of sales and purchase as against plead @ 0.05% 3. The Appeal is in time and order." ITA No. 5175/Mum/2024, (Assessment Year: 2018-19) 4. The revenue has raised the following grounds of appeal: 1. "Whether on the facts and in the circumstances of the case and in law the Ld CIT(A) erred in restricting the addition on account of bogus entries at 1% as against disallowance made by the assessing officer @ 2% of bogus entries when ....
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....IT(A). 8. The learned Authorised Representative ('ld. AR' for short) for the assessee contended that on identical facts various coordinate benches have held the disallowance on bogus sales and purchases to be lesser than 1% and relied on a catena of decisions for the disallowance being restricted to lesser than 0.5% as tabulated herein under: Sr. No. Name of case referred Forum A.Y. Appeal No. Rate Adopted Adopted on Sale/Purchase Both 1 Anand Kumar Jain vs. ACIT, Central Circle-26, New Delhi ITAT Delhi 2016-17 1324/DEL/2019 0.47% Sales 2. Naresh Kumar Jain vs. DCIT, Central Circle-26, New Delhi ITAT Delhi 2016-17 1331/DEL/2019 0.47% Sales 3. JCIT (OSD) vs, Pradip Overseas Ltd. ITAT Ahmedabad 2013-14 ITA /790/AHD/2018 0.30% Purchases 4. Ram Prakash Bhatia vs. ACIT ITAT Delhi 2012-13 ITA/651/DEL/2023 0.15% Sales 5. Spanco Ltd. VS. Department of Income Tax ITAT Mumbai 2007-08 ITA 1128/Mum/2012 0.25% Sales 6. Goldstar Finvest P. Ltd. vs. DCIT ITAT Mumbai 2010-11 ITA/74/Mum/2015 0.15% Sale & Purchase 7. ITO- 10(2)(4), Mumbai....
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....ide documentary details pertaining to the transaction entered into with SVP group during the assessment proceeding and during the first appellate proceeding had submitted some of the details, where remand report was called for. The assessee further contended that it did not transact with SVP group from A.Y. 2013-14 to 2014-15 and the details of parties of SVP group in which the assessee was transacted from A.Y. 2015-16 to 2018-19 were said to be furnished along with the details of purchase and sales transaction with the said entities. It was also observed that the SVP Group has entered into various transactions, where payments to other entities were made against bogus purchases and booked bogus expenditure on capital goods which were received back by the group either as unsecured loans, share premium or in the form of cash received. The ld. CIT(A) also remanded the same to the ld. AO for the reason that the assessee's contentions was that it had transacted only with seven entities of the SVP group, where even during the remand proceeding, the assessee was unable to file the complete details of the transaction with supporting documentary evidences. In the absence of the documentary ....
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....the amount added is included in the assessment of the beneficiaries and, therefore, same cannot be added once again in the hands of the respondent-assessee. There is no basis for such a submission made by the respondent-assessee, nor is it stated so before the Assessing Officer or the Appellate Authorities. Such a factual submission for the first time before this Court in a third appeal by oral argument across the bar cannot be permitted. 20. The CIT(A) has adopted a fair approach by stating that if the respondent assessee identifies the beneficiaries, then the rate of commission adopted should 0.37% of such identified beneficiaries and if the respondent-assessee fails to identify the beneficiaries, then in that case, the sum credited in the bank accounts would stand confirmed under Section 68 of the Act. In our view, the Tribunal was not justified in directing 0.15% of the total deposits (explained and unexplained) appearing in the bank accounts as income. The Tribunal has not given any reason as to why the directions of the CIT(A) in para 4.3 of the CIT appeal's order are wrong or erroneous. In our view, the Tribunal did not consider the issue from the proper perspec....
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....can the revenue verify whether the credits appearing belong to such customers. The CIT(A), therefore, gave the relief in para 4.3 by observing that an estimate of income will be made only in case of identified beneficiaries and balance credits would be assessed under Section 68 of the Act. 38. The respondent-assessee cannot contend that they will not give details of beneficiaries, but at the same time, credits cannot be assessed in its hands. We wonder how the revenue can find out to whom the credits belong to unearth unaccounted income. The respondent assessee cannot act as a shield for beneficiaries by making such a submission and at the same time refuse to pay taxes for the unexplained amounts in its bank accounts. 39. If the submissions made by the counsel for the respondent-assessee that since they are engaged in providing accommodation entry and therefore, the credits appearing in the bank cannot be assessed in its hands has to be accepted without the respondent-assessee giving details of the beneficiaries which they have flatly refused as recorded in the statement referred to hereinabove then the consequence would be that such unaccounted sum can never be b....