ACIT Vs Radhey Shyam Bansal (ITAT Delhi)
Accommodation Entry Operator Taxable Only on Commission @0.50%; No Gross Additions Without Incriminating Material – ITAT Delhi Dismisses Revenue Appeals
In ACIT vs. Radhey Shyam Bansal (ITA Nos. 5719 to 5721/Del/2025; AYs 2010-11 to 2012-13), the Delhi ITAT “G” Bench dismissed all three Revenue appeals and upheld the CIT(A)’s order restricting additions merely to commission income @0.50% on alleged accommodation entry transactions, instead of taxing the entire gross credits.
The Assessee, a practising Chartered Accountant, was subjected to search u/s 132. In earlier rounds, the Tribunal had remanded the matter directing the AO to keep in mind CIT vs. Kabul Chawla and examine the Assessee’s categorical statement u/s 132(4) that he acted only as a moderator/facilitator of accommodation entries, earning commission. However, in set-aside proceedings, the AO again made massive additions of bank credits, diary entries and loose papers as unexplained income, ignoring the remand directions.
The CIT(A) granted substantial relief by categorising the additions and holding that:
(i) credits in the Assessee’s own bank accounts already offered to tax would lead to double taxation;
(ii) credits in bank accounts of relatives, clients and friends could not be added in the Assessee’s hands in absence of incriminating material or control;
(iii) credits in bank accounts of companies could not be taxed as unexplained in Assessee’s hands in view of Kabul Chawla and Abhisar Buildwell (SC), but since the Assessee admitted being an entry operator, only commission income @0.50% was taxable; and
(iv) even for pocket diaries and loose sheets seized, additions were to be confined to commission @0.50%, not gross figures.
The Tribunal affirmed these findings, holding that in absence of incriminating material, completed assessments cannot be disturbed u/s 153A, and where the Assessee himself admits acting only as a facilitator, taxation must be restricted to real income i.e. commission, following Manoj Kumar Jain (ITAT Delhi). Consequently, the Revenue’s attempt to resurrect huge additions running into hundreds of crores was rejected, and all appeals were dismissed
FULL TEXT OF THE ORDER OF ITAT DELHI
