ACIT Vs Anil Aggarwal (ITAT Delhi)
Entry operator’s commission income alone taxable, not entire turnover- ITAT Delhi upholds deletion of ₹19.18 crore protective addition
A search u/s 132 was conducted on the Rockland Group & related parties on 06.09.2011, followed by a consequential search on Shri Anil Aggarwal, an alleged entry operator from Laxmi Nagar, Delhi. Based on seized material & his statement u/s 132(4), AO held that Aggarwal had provided accommodation entries worth ₹19.18 crore during FY 2007-08 & earned commission income thereon.
AO estimated the commission at 0.6% & added ₹11,50,800, besides making a protective addition of ₹19.18 crore u/s 68 treating the entire turnover as unexplained cash credits.
Before CIT(A), Assessee accepted having provided entries but argued that only 0.1% commission was earned & declared. CIT(A) partly upheld AO’s estimation, restricting the addition to 0.5% differential commission = ₹9.59 lakh, & deleted the protective addition of ₹19.18 crore noting that AO neither established that the funds belonged to Assessee nor mentioned in whose case the substantive addition was made.
Tribunal observed that AO himself accepted Assessee as merely a commission agent, earning small margins, & not the owner of the transacted sums. Since no substantive addition existed elsewhere & no evidence showed that ₹19.18 crore represented his own income, the protective addition was unsustainable.
