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TMI Blog2021 (12) TMI 1212X X X X Extracts X X X X X X X X Extracts X X X X ..... arning brokerage at the rate of Rs. 0.25 percent on the said amount and offered a sum of Rs. 5 Lacs for taxation. Learned Assessing Officer, however, did not agree with such rate of brokerage and estimated the same at Rs. 3 percent and made an addition to the tune of Rs. 59, 70, 000/-. 3. When the assessee carried the matter in appeal before the Ld. CIT(A), Ld. CIT(A), by order dated 15/3/2010 observed that the mere statement of the assessee that he was receivingthe brokerage at 0.25% cannot be accepted, and at the same time the learned Assessing Officer also does not possess any evidence in support of estimating the brokerage at 3%. In such situation, Ld. CIT(A) observed that in the interest of Justice and revenue to tax the assessee by adopting the brokerage rate on various bogus transactions amounting to Rs. 19,86,06,566/-at 0.75% is proper. 4. Aggrieved by such a finding by the Ld. CIT(A), both the assessee and the Revenue preferred appeals before the Tribunal, and the Tribunal by order dated 23/7/2010 observed that there was no evidence in support of the claim of the assessee that he was earning commission at the rate of Rs. 0.25 percent only and at the same time the action ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 147 of the Act was barred by limitation and that the evidence is submitted earlier may be considered. It was further submitted by the assessee that since the assessee was a share broker and showing brokerage which is normally charged in his profession, the brokerage rate at 0.25% may be accepted and no addition was called for under section 68 of the Act. 7. Learned Assessing Officer observed that the assessee had nothing to offer an explanation, but repeated the submissions made on the earlier occasion. Further even according to the assessee, entire amount deposited in assessee's account was from the bank account maintained by Sh. Mahesh Kumar but the assessee failed to produce Mahesh Kumar to offer proper explanation as to the source of such deposits. Learned Assessing Officer further observed that the assessee did not bring anything on record that the cash deposited in the account of Sh. Mahesh Kumar was provided by the beneficiaries, namely, the persons to whom cheques were issued by the assessee and therefore the entire money deposited in the bank account of the assessee as a check from Sh. Mahesh Kumar remains unexplained. On this premise learned Assessing Officer, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osits in his account or not to be added to the income of the assessee. Ld. DR submitted that inasmuch as the learned Assessing Officer made an addition under section 68 of the Act, the question of any percentage does not arise and therefore, subject to the restriction on the quantum of addition, the addition has to be upheld. 11. Per contra, it is the submission on behalf of the assessee that when the total addition was to be restricted to 59.70 Lacs as directed by the Tribunal, firstly, the tax effect in this case comes to less than 50 lakhs and hit by the circular No. 17/2019 dated 8/8/2019 with clarification dated 20/8/2019. It is further argued that the assessment contrary to the directions of the Tribunal is bad under law and further that the assessing officer failed to take into consideration the submissions made on behalf of the assessee. She further submits that inasmuch as the Revenue does not dispute the contention of the assessee that the assessee is an accommodation entry provider receiving only commission, the scope of dispute in this matter is only in respect of the rate of commission but not otherwise. She, however, submits that in view of the deletion of the Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the Revenue to contend that the learned Assessing Officer was empowered, in case the assessee fails to prove the exact rate of commission, to make addition of the entire deposits to the income of the assessee under section 68 of the Act. 15. On the face of the directions given by the Tribunal and also the Hon'ble High Court, it is, therefore, clear that the learned Assessing Officer is not justified in making the entire deposits to the tune of Rs. 19, 89, 26, 581/-to the income of the assessee under section 68 of the Act. Even going by the directions of the Tribunal, the learned Assessing Officer was to restrict the addition to Rs. 59.70 Lacs only. In that event, it is evident that after the impugned orders of the Ld. CIT(A) restricting the addition to Rs. 11, 93, 559/-, the matter false in the ambit of circular No. 17/2019 dated 8/8/2019 read with clarification dated 20/8/2019. 16. Ld. CIT(A) categorically observed that the AO did not bring on record any material to establish that the deposits in the assessee's account were not accommodation entries but represent his own unaccounted income. In view of the fact that, from the beginning the case of the Revenue has been that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) is right in holding that the making addition of the entire deposits under section 68 of the Act by the learned Assessing Officer was not justified. 19. No coming to the course of quantum of commission, initially in the 1st round of litigation, Ld. CIT(A) estimated it at 0.75% whereas in the 2nd round of litigation, by following the decision of the Tribunal in the case of JRD stockbrokers private limited vs. ACIT reported in 124 TTJ (del) 566, Ld. CIT(A) estimated the same at 0.6% and restricted the addition to Rs. 11, 93, 559/-. It is the submission on behalf of the Revenue that inasmuch as the Tribunal directed in the 1st round of litigation that let the addition be restricted to Rs. 59.70 Lacs, it would be just and proper, now to restrict the addition to Rs. 59.70 Lacs inasmuch as the assessee failed to prove the exact rate of commission received by him. 20. On a careful consideration of the matter we are of the considered opinion that the Ld. CIT(A) considered the material very carefully, including the reasons for estimating the commission at 0.750% in the initial round of litigation and while following the decision of the Tribunal in the case of JRD stockbrokers (supra) in ..... 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