TMI Blog2019 (5) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... rate of 2.25 % by the AO and reduced to 2% by the ld. CIT(A) is concerned, this issue has already been decided in the Group cases of Tarun Goyal vide [ 2019 (1) TMI 1266 - ITAT DELHI] thereby AO has been directed to adopt the rate of commission @ 0.50% or 50 paise and computed the profit accordingly. - ITA No. 1565/Del./2017, 1566/Del./2017, 1567/Del./2017, 1568/Del./2017, 1569/Del./2017, 2436/Del./2017, 2437/Del./2017, 2438/Del./2017, 2439/Del./2017, 2440/Del./2017, 484/Del./2015, 6516/Del./2015, 6710/Del./2016 - - - Dated:- 26-4-2019 - Shri R.K. PANDA, Accountant Member And Shri Kuldip Singh, Judicial Member For the Assessee : Shri V.P. Gupta, Advocate, Shri Anunav Kumar, Advocate For the Revenue : Ms. Nidhi Srivastava, CIT DR ORDER PER BENCH : Present cross appeals filed by the assessee as well as by the revenue are being disposed off by way of composite order to avoid repetition of discussion. 2. The Appellant, M/s. Dwarka Impex Pvt. Ltd. (hereinafter referred to as the assessee ) by filing the present appeals sought to set aside the impugned orders all date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred in law and on facts of the case in deleting the addition made by AO u/s 68 of the IT Act amounting to ₹ 1,64,01,670/-, ₹ 93,51,252/-, ₹ 36,00,386/-, ₹ 3,01,56,000/- ₹ 50,00,000/- for assessment years 2004-05, 2005-06, 2006-07, 2007-08 2008-09 respectively. 3. Ld Commissioner of Income-tax (Appeals) erred in law and on facts of the case in reducing the rate of commission income from 2.25% as applied by the AO to 2.0% . 4. The Appellant, M/s. Bhavani Portfolio Pvt. Ltd. (hereinafter referred to as the assessee ) by filing the present appeals sought to set aside the impugned order dated 13.10.2014 passed by the Commissioner of Income-tax (Appeals), Noida, qua the assessment year 2009-10 on the grounds inter alia that :- 1. That the CIT(A) erred in upholding the addition made by Assessing Officer of ₹ 2,27,79,793/- on account of commission income calculated @ 2.25% on total of all credit entries in the bank account, without correctly appreciating the facts of the case and also without properly appreciating and following the order and direction of Hon'ble ITAT vide its order dated 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... / assessment orders in other cases could not be considered for the purpose of taking the rate of commission inspite of the fact that the Hon'ble Tribunal had directed to determine the rate of commission taking into consideration the precedence available in this regard. 4. That the CIT(A) also erred in upholding the order of Assessing Officer determining commission @ 2% on the basis of rough notings in seized papers without appreciating that the notings under reference could not be relied upon as neither same were specifically in regard to rate of commission nor details were corroborated with other material and in any case the rates mentioned therein for a small amount could not be applied in all the cases of the Group for determining the rate of commission on total amount of accommodation entries and the notings under reference were also not relevant to all the assessment years. 6. The Appellant, M/s. Geefcee Finance Ltd. (hereinafter referred to as the assessee ) by filing the present appeals sought to set aside the impugned order dated 15.12.2016 passed by the Commissioner of Income-tax (Appeals), Noida qua the assessment year 2005-06 on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... remium on exorbitant prices through their nondescript companies, certain documents, loose papers and other material were found/seized and consequently assessment was completed under section 153C of the Income-tax Act, 1961 (for short the Act ). 8. Assessee had challenged assessment orders before the ld. CIT (A) who has confirmed the assessment orders that the rate of commission charges adopted by the AO is justified. Thereafter, assessee had challenged order passed by the ld. CIT (A) before the Tribunal who had restored the matter back to AO qua AYs 2004-05 to 2008-9 for fresh adjudication in accordance with law. 9. AO issued notice under section 143(2) and 142(1) calling upon the assessee to furnish details as under :- (i) Furnish the copy of ITR, balance sheet, tax audit report, computation of income, all annexures and notes of accounts; (ii) Furnish the copy of all statements of Tarun Goyal recorded on oath during the course of search and seizure operation as well as post operation period, if any. (iii) The Hon ble ITAT has set aside the issue to A.O. to examine the chain of transactions, they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llenge by the assessee as well as by the revenue. 15. In the backdrop of the aforesaid facts and circumstances of the case, orders passed by the lower Revenue authorities in the first round as well as second round of litigation and case laws relied upon, the first question arises for determination in this case is :- as to whether in the second round of litigation pursuant to the remand made by the Tribunal, AO is empowered to make further addition on account of credit entries appearing in the bank statement under section 68 of the Act which was not the subject matter of the first round of litigation? 16. Perusal of original assessment orders qua AYs 2004-05 to 2008-09, available at pages 38 to 97 of the paper book, goes to prove that the only addition made by the AO is on account of commission income @ 2.25% on accommodation entries provided by the assessee company and no addition under section 68 of the Act is there. From the copy of Form No.36 filed before the Tribunal in all the appeals for AYs 2004-05 to 2008-09 in the first round of appeal available at pages 33 to 37, it is again proved that no ground as to the addition made u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee by the Assessing Officer in respect of 42,000 bottles out of 5,46,000 bottles cannot be withdrawn by the Department and to that extent alone the assessee succeeds in this civil appeal. Lastly, as stated above, in this case the Commissioner of Income-tax (Appeals) had remitted the matter to the Assessing Officer who on remand came to the conclusion that all 5,46,000 bottles stood sold before March 31, 1991. This finding of fact has become final. It has not been challenged. Hence, the Department has erred in disallowing the depreciation of ₹ 18,04,572. 19. Similarly, Hon ble Gujarat High Court in case of DCIT vs. Surat Electricity Co. Ltd. (2011) 337 ITR 271 (Guj.) decided the identical issue in favour of the assessee by returning following findings :- Thus, this Court in the above quoted decision has held that the set aside of assessment made by the appellate authority is always in accordance with the directions given by the appellate authority for making a fresh assessment. But, the most material part of the provision is the opening portion which stipulates In an appeal against an order of assessment . In other words, the entire g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 Ors., thereby AO has been directed to adopt the rate of commission @ 0.50% or 50 paise and computed the profit accordingly by returning following findings :- 14. The ld. counsel for the assessee also relied heavily on various decisions of the co-ordinate bench wherein the Tribunal has adopted rate ranging from 0.15 paise to 0.50 paise i.e 0.15% to 0.50%. 15. As mentioned elsewhere, in such illegal activities, there cannot be any precedence and the rate varies from facts of each case. 16. To put an end to the litigation and in the interest of justice and fair play, in our considered opinion, 0.50 paise or 0.50% should be taken as the reasonable rate of profit/commission in such clandestine activities. We, accordingly, direct the Assessing Officers to adopt 0.50% or 0.50 paise and compute the profit accordingly. 23. Following the decision rendered by the coordinate Bench of the Tribunal, AO is directed to adopt the decision of Group cases of Tarun Goyal (supra) and computed the profit accordingly in these cases also. 24. So far as appeals bearing ITA Nos.484/Del./2015, 6516/Del./2015 6710 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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