Anil Kumar v. Appellan

IN THE HIGH COURT OF PUNJAB & HARYANAAT CHANDIGARH ITA No.121-2022 (O&M)Date of Decision: 31.05.202 Anil Kumar Versus ....... Appellan Commissioner of Income Tax, Karnal and another ......Respondents CQRAM: HON'BLE MR. JUSTICE TEKEJINDER SINGH DHINDSHON'BLE MR. JUSTICE PANKAJ JAINPresent: Mr. Susheel Gautam, Advocate for the appellant. ## TEJINDER SINGH DHINDSA J.(Oral) The instant appeal under Section 260-A of the Income Tax Act1961 is directed against the order dated 25.11.2021 (Annexure A3) passedby the Income Tax Appellate Tribunal (Delhi Bench) 'A’; New Delhi, Brief factual matrix emanating from the pleadings on record arethat the appellant who claims to be in the business of trading as a wholesalerhad filed return of income declaring taxable income of Rs.3,46,070/- for theassessment year 2013-2014, During scrutiny proceedings, the Assessing Officer, called uponthe appellant to furnish copy of bank accounts of certain firms under Section133 (6) of the Income Tax Act 1961 (for short the ‘Act). Upon perusal of thebank accounts the Assessing Officer noticed that the appellant had madehuge cash withdrawal which indicated that he was an entry operator. It wasalso found that the appellant had purchased goods from 21 firms whoseaddresses were either found to be not existing or such firms had refused toSHWETAaccept the service of notice under Section 131 of the Act. The Assessing2022.06.01 17:46I attest to the accuracy andauthenticity of this document ITA No.121-2022 (O&M) officer formed an opinion that the appellant had never supplied any itemsand had issued bills to give benefits to certain firms to inflate their expenses,Further the appellant had not furnished complete books of accountsalongwith vouchers. The provisions contained under Section 145 of the Actwere invoked by the Assessing Officer thereby rejecting the books ofaccount. By reckoning the trade practice in the case of entry operators, theAssessing Officer took a view that the appellant must have charged 10% ofthese entries and accordingly assessed the total income of the assessee atRs.1,07,76,050/- @ 10% being in the business of providing entries toVarious businessmen. Appellant then filed an appeal before the CIT appealswhich was partly allowed and in the following terms:- 3.3 Findings:- A perusal ofthefacts ofthe case reveal thateven before the undersigned, the appellant has agreed to thefactthat he provided accommodation entries to dealers in order tohelp reduce their tax liabilities. The Assessing Officer hasclearly mentioned that complete books ofaccounts vouchers etc.were not produced and, hence, the books were rightly rejectedand an estimate made of the income earned out of the entriesprovided. The Assessing Officer has pegged the income @ 10%Of Rs.10,77,60,505/- (the figure shown as the appellant'sturnover). However, the rate of 10% appears to be on the higherside as normally the payouts for arranging accommodationentries range on an range between 2.5% to 3.5%. I, therefore,peg the rate reasonably applicable at calculating the income @3% ofRs/10,77,60,505/- which comes to Rs.32,32,815/-.. After adjusting with the returned income of Rs.3,46,070/- the totalincome is calculated at Rs.28,86,745/-. The appellant gets areliefofRs.75,43,235/- Against the order passed by the CIT (Appeals) matterwas carried to the Income Tax, Appellate Tribunal and which has led to thepassing of the impugned order dated 25.11.2021 at Anenxure A-3, Resultantly, the instant appeal under Section 260-A of the Act. adjusting with the returned income of Rs.3,46,070/- the totalincome is calculated at Rs.28,86,745/-. The appellant gets areliefofRs.75,43,235/- Against the order passed by the CIT (Appeals) matterwas carried to the Income Tax, Appellate Tribunal and which has led to thepassing of the impugned order dated 25.11.2021 at Anenxure A-3, Resultantly, the instant appeal under Section 260-A of the Act. Counsel has argued that a vital aspect has beenoverlooked inasmuch the Assessing Officer pertaining to the Assessmentyear 2014-15 has made assessment by taking income @ 0.5 % on the totalturnover shown by the appellant. Further urged that there was no differencein the nature of business of the appellant during the year in question 1.e.assessment year 2013-14 and assessment year 2014-15. Categoricsubmission is made that the appellant would be agreeable with theamount/income to be calculated @ 0.5% of the total turnover worth Rs,109532827/- for the assessment year 2013-2014. No other contention has been raised. Having heard counsel at length, we are of the consideredview that the instant appeal does not raise any question of law much lesssubstantial question of law and deserves to be dismissed. In the impugned order dated 25.11.2021 passed by theIncome Tax Appellate Tribunal at Annexure A-3, a finding has beenreturned that insofar as the assessment years 2014-15 and 2015-16 areconcerned, there is no material to indicate that the appellant had venturedinto providing accommodation entries to the dealers to help them reduce theSHWETA2022.06.01 17:46tax liabilities. Still further it has been recorded that insofar as theI attest to the accuracy andauthenticity of this document . assessment years 2014-15 and 2015-16 are concerned the appellant had beenseen as dealing in wholesale business of trading and as such the revenueitself had accepted 0.5 % ratio on the total billing to assess income of theassessee. Such distinguishing feature between the assessment year inquestion i.e. 2013-14 on the one hand and the assessment years 2014-15 and2015-16 on the other hand could not be demolished at the hands of theappellant. It is a pure finding of fact which would not require anyintervention at the hands of this Court while considering an appeal underSection 260-A of the Act. We find that the order dated 25.11.2021 passed by the IncomeTax Appellate Tribunal is founded on sound and cogent reasoning. Thesame does not suffer from any legal infirmity, There is no merit in the instant appeal. Dismissed. (TEJINDER SINGH DHINDSA)JUDGE (PANKAJ JAIN) JUDGE 31.05.2022shweta Whether speaking/reasoned : Yes/No Whether reportable. * Yes/No