2020 (10) TMI 241 - AT - Income Tax

Estimation of commission income on accommodation transactions - HELD THAT - Case related to A.Y 2008-09 are similar to the facts decided for A.Y 2009-10 2017 (1) TMI 1728 - ITAT MUMBAI and moresoever in both such assessment years the commission income was estimated by the A.O @ 1.50% of accommodation transactions. The Hon ble ITAT, in appellant s case, related to A.Y 2009-10 had directed the A.O to estimate the commission income @ 0.10% on accommodation transaction and consequently the A.O had recomputed the commission @ 0.10% on accommodation transactions. Accordingly,direct the A.O to estimate the commission income @ 0.10% on accommodation transactions determined in the assessment order and delete the balance addition. In the result, the appeal for A.Y 2008- 09 is Partly allowed.

Summary

Issues:
1. Estimation of commission income on accommodation transactions for A.Y 2009-10.
2. Estimation of commission income on accommodation transactions for A.Y 2008-09.

Issue 1: Estimation of commission income on accommodation transactions for A.Y 2009-10:

The appeals were filed by the revenue against the common order of the Ld Commissioner of Income Tax (Appeals) -29, Mumbai for A.Y 2008-09 and 2009-10. The assessee, engaged in cheque discounting activities, had its income estimated at different rates by the Assessing Officer (A.O) and the CIT(A). The Hon'ble Tribunal directed the A.O to exclude certain transactions and estimate the commission income. The A.O reworked the commission at 0.10% of the net transaction value. The CIT(A) observed that the A.O had passed the order giving effect to the Tribunal's decision, making the appeal infructuous. The Tribunal upheld the CIT(A)'s decision, stating that the income had been determined, rendering the order under section 143(3) r.w.s 147 inoperative.

Issue 2: Estimation of commission income on accommodation transactions for A.Y 2008-09:

In the appeal for A.Y 2008-09, the revenue challenged the CIT(A)'s order granting partial relief to the assessee regarding the estimation of commission income on accommodation transactions. The CIT(A) considered the facts and directed the A.O to estimate the commission income at 0.10% on accommodation transactions, similar to the A.Y 2009-10 decision. The Tribunal noted that the CIT(A) relied on the Hon'ble ITAT's decision and upheld the relief granted, dismissing the revenue's appeal.

In conclusion, both appeals filed by the revenue were dismissed by the Tribunal, affirming the decisions made by the CIT(A) regarding the estimation of commission income on accommodation transactions for the respective assessment years.