TMI Blog2012 (9) TMI 724X X X X Extracts X X X X X X X X Extracts X X X X ..... enue contended such purchases of capital assets as fictitious - Held that:- It is not the case of the Revenue that the plant and machinery were not installed at the assessee’s business premises or the same were not used for the purpose of the business of the assessee or the rate of depreciation claimed by the assessee is not according to the Rules. Estimated disallowance of depreciation made by the A.O. is not sustainable in law and accordingly order of CIT(A) in deleting the same is upheld - Decided in favor of assessee. - I.T.A. No. 4036 to 4038/Mum/2011, I.T.A. No. 4466 & 4467/Mum/2011 - - - Dated:- 11-7-2012 - Dinesh Kumar Agarwal And B. Ramakotaiah, JJ. Assessee by : Vijay Mehta Respondent by : Baban D. Patil ORDER Per Dinesh Kumar Agarwal, J.M. : The appeal in ITA No. 4036/M/2011 for A.Y. 2004-05 is preferred by the assessee, the appeals in ITA Nos. 4037 4038/M/2011 and ITA No. 4466 4467/M/2011 for assessment years 2005-06 and 2006-07 are cross appeals by the assessee and the Revenue and all are directed against the common order dtd. 14-03-2011 passed by the ld. CIT(A) 37, Mumbai. Since the facts are identical and common issues are involved, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e by any party asked the assessee as to why the commission @ 0.25% on the aggregate transactions paid by you on obtaining the accommodation entries should not be treated as income of the assessee. In response, the assessee vide letter dtd. 19-12-2008 while asking for cross examination of Mr. K.K. Gupta inter alia stated that the goods purchased and sold to various parties were matched, matching statement clearly shows that each and every transaction with the companies of Mr. Gupta, the assessee made profit ranging between 40% to 45%, the statement of Mr. K.K. Gupta is highly unreliable and there is no reason for the assessee to obtain accommodation entries. However, the A.O. did not accept the assessee s explanation. The A.O. after relying on the statement of Mr. K.K. Gupta worked out the commission of ₹ 2,51,698/- being 0.25% of the total purchases of ₹ 4,62,59,347/- (+) total sales of ₹ 5,44,20,202/- aggregating to ₹ 10,06,79,549/- and added the same to the total income of the assessee. On appeal, the ld. CIT(A) while agreeing with the views of the A.O., confirmed the addition made by the A.O. 9. At the time of hearing the ld. counsel for the assessee, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee in his submissions dtd. 19-12-2008 stated that he is showing profit ranging between 40 to 45% on the purchases has not been uncontroverted by the Revenue even at this stage and also keeping in view the books of accounts have not been rejected, we are of the view that the ld. CIT(A) was not justified in sustaining the addition of commission of ₹ 2,51,698/- and accordingly we delete the same. The grounds taken by the assessee are, therefore, allowed. ITA No. 4037/Mum/2011 (By assessee for A.Y. 2005-06) 14. Ground No. 1 is against the validity of the assessment u/s 147/148 of the Act. 15. At the time of hearing, the ld. counsel for the assessee submits that he does not want to press the above ground which was not objected to by the ld. D.R. 16. That being so and in the absence of any supporting material placed on record by the ld. counsel for the assessee, the ground taken by the assessee is, therefore, rejected being not pressed. 17. Ground No. 2(a), 2(b) and 2(c) are against the sustenance of addition of commission of ₹ 2,00,229/-. 18. At the time of hearing both the parties have agreed that the facts of the above issue are similar to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he unit eligible for deduction u/s 10B of the Act which was not objected to by the ld. D.R. 31. That being so and in the absence of any supporting material placed on record by the ld. counsel for the assessee, the grounds taken by the assessee are, therefore, rejected. ITA No. 4466/Mum/2011 ITA No. 4467/Mum/2011(Revenue s appeals for assessment years 2005-06 2006-07). 32. The common ground taken by the Revenue in both the above appeals reads as under:- On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the disallowance of depreciation in respect of portion of value shown in the books which represented over invoicing of assets as detected during the course of survey and in respect of which the Ld. CIT(A) confirmed the addition on commission paid for such bogus bills. 33. Brief facts of the above issue are that it was observed by the A.O. that the assessee has shown purchases of capital goods from the concerns of Mr. K.K. Gupta which are as under:- Sl No. Name of the concern Amount (Rs.) 1 Triton Infotech Pvt. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owance made by the A.O. 34. At the time of hearing the ld. D.R. supports the order of the A.O. 35. On the other hand, the ld. counsel for the assessee relied on the order of the ld. CIT(A). 36. We have carefully considered the submissions of both parties and perused the material available on record. We find that the facts are not in dispute inasmuch as it is also not in dispute that the assessee has installed the above plant and machinery in its business centre and has claimed depreciation thereon. However, the A.O. without any basis has disallowed the depreciation at 35% of the depreciation claimed. On appeal the ld. CIT(A), however, allowed the same vide finding recorded in para 6.3.1. of his order which is reproduced as under:- I have carefully and dispassionately considered the facts and circumstances of the case. It is noticed that the appellant had made a written submission before the A.O. on 19.12.2008, wherein, it was stressed that the appellant had filed detailed statement of the impugned assets on which depreciation was claimed. The A.O. has not made any adverse comment on the detailed statement of assets containing all bills with respect to the nature of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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