TaxTMI 
TaxTMI 
2026 (9) TMI 972
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....s not valid as per Provisions of Act. Ground No. 3 - That the Ld. AO grossly erred in law and in facts of the case in making estimated additions for commission of Rs. 46.97,839/- on sales made by assessee company to group companies. Ground No. 4 - That the Ld. AO grossly erred in law and in facts of the case in making estimated additions for commission of Rs. 43,90,057/- sales made by assessee company to non-group entities without allowing telescoping of gross profit derived from sales. Ground No. 5 - That the Ld. AO grossly erred in law and in facts of the case in assessing cash deposits of Rs. 34,66,250/- during demonetization period as unexplained money u/s. 69A of the Act despite the fact that said cash was deposited out of cash in hand as per books of account. Ground No. 6 - That the Ld. CIT(A) grossly erred in law and in facts of the case in rejecting the alternate plea of assessee that in case commission of Rs. 90,87,895/- is deemed to be earned in cash, telescoping of the same against the additions of Rs. 34,66,250/- being cash deposited during demonetization period shall be allowed. Ground No. 7 - That the Ld. AO grossly erred i....
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.... of the cash withdrawn from the bank to safeguard from liabilities. The Ld.AO rejected the explanation furnished by the assessee and considered the entire cash deposited as unexplained money u/s. 69A of the Act. The Ld.AO further noted that, it is alleged set of brought forward loss, business loss of Rs. 14,53,722/- as the said loss had already been disallowed in the A.Y. 2015-16. Aggrieved by the Order of the Ld.AO, the assessee preferred the appeal before the Ld.CIT(A). 3. Before the Ld.CIT(A), the assessee contended that the commission was been wrongly assessed on the sales made by the assessee. It was submitted that the benefit of telescoping of the gross profit of Rs. 63,37,583/- was not granted against the commissioned income. 3.1. TheLd.CIT(A) after verifying the submissions of the assessee observed as under:- "The Assessing Officer has made an addition of Rs. 90,87,895/- as commission income, alleging that the turnover of Rs. 90,87,89,588/-shown by the appellant is bogus and represents accommodation entries. The appellant has contended that the Assessing Officer has erred in making the addition without appreciating the facts of the case. The appellant has ....
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....power India Limited in ITA No. 3205/Mum/2019. M/s Empower India Limited vs. DCIT in ITA No. 3646/Mum/2019. M/s Empower India Limited M/s Avance Technologies Limited 3.1 In view of the above facts, the turn over to the extent of Rs. 46,97,838/- was with the group companies and based on the decisions relied in the case of the group companies, the commission could not have been earned by the assessee. The Ld.AR thus submitted that, the commission may be restricted only to Rs. 43,90,057/- which was from the sales with non-group companies. 3.2. On the contrary, the Ld. DR vehemently supported the Orders passed by the authorities below. We have perused the submissions advanced by the both sides in the light of record placed before us. 4. Admittedly, the transactions in question constitute circular trading transactions entered into between the assessee and its group concerns forming part of the Shri Shirish C. Shah Group of Companies. It is also an admitted position that the decision relied upon by the assessee in the preceding paragraph pertains to another concern belonging to the very same group. 4.1. Circular trading and accommodation entry tra....
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....de cash withdrawals from its bank accounts during the year under consideration and the cash so withdrawn was subsequently redeposited during the demonetization period. It was, therefore, contended that the source of the cash deposits stood duly explained. 5.2. In support of the aforesaid contention, the Ld. AR placed reliance upon the cash flow statement for the financial year relevant to the assessment year under consideration, which is reproduced herein below: Date Bank Amount 11/04/2016 Sai Industries 95,000 13/04/2016 Sai Industries 1,00,000 15/04/2016 Sai Industries 1,05,000 19/04/2016 Sai Industries 1,00,000 23/04/2016 Sai Industries 85,000 28/04/2016 Sai Industries 90,000 30/04/2016 Sai Industries 67,294 23/05/2016 IDBI Bank 2,000 27/05/2016 HDFC Bank 1,50,000 31/05/2016 HDFC Bank 2,50,000 08/07/2016 IDBI Bank 5,30,000 16/07/2016 IDBI Bank 2,50,000 06/09/2016 IDBI Bank 2,00,000 09/09/2016 IDBI Bank 4,00,000 13/10/2016 IDBI Bank 45,000 24/10/2016 IDBI Bank 5,00,000 04/11/2016 IDBI Bank 35,000 08/11/2016 IDBI....