Saanvi Developers & Realtors Pvt. Ltd. Vs ITO (ITAT Kolkata)
ITAT Kolkata held that undisclosed commission income on accommodation entries to be added @0.15% instead of 1%. Accordingly, AO directed to compute the rate the commission @0.15% and not 1%.
Facts- On the basis of credible information, the case of the assessee was selected for reassessment and notice u/s 148 was issued. In compliance with the notice u/s 148 the assessee filed return of income declaring total income of Rs. 26,90,090/-. Again notices along with requisitions were issued to the assessee, but there was not compliance as a result of which, the undisclosed commission income on such accommodation entries @1.0% as per prevailing market rate worked out to Rs. 87,86590/- and the same is added back to the total income of the assessee as undisclosed commission income.
CIT(A) partly allowed the appeal. Being aggrieved, the present appeal is filed.
Conclusion- Held that the assessee has filed return of income declaring total income of Rs. 26,90,090/-. The AO on account of non-response from the assessee has held that undisclosed commission income on such accommodation entries @ 1.0% as per the prevailing market rate. The main contention of the assessee is that it should be 0.15% which was already accepted by the department. We have gone through the order passed by the NFAC for AY 2011-112 against the same assessee and fined that in the said assessment year the Ld. CIT(A) has directed the AO to take the percentage @ 0.15% and not @ 1% as admitted by him. Thus, we are in this view that rate of commission should be 0.15% and not @ 1%., Accordingly the case of assessee is allowed and the AO is directed to compute the rate the commission @0.15% and not 1%.
