9911796707
TMI Blog2013 (12) TMI 1714X X X X Extracts X X X X X X X X Extracts X X X X ..... and 2010-11 vide his order dated 17-10-2011. The only common issue in these two appeals of assessee against the order of CIT(A) confirming the action of Assessing Officer in applying incorrect 'peak credit'. For this, assessee has raised six common grounds in both years except the amount of assessment under challenged at ₹ 5.05 lakh in AY 2009-10 and ₹ 39.95 lakh in AY 2010-11. 2. Briefly stated facts are that a search operation u/s. 132 of the Act was carried out by Income-tax Department on 08-12-2009 and on subsequent dates on Shashi Kant Khetan Group. During the course of search, five bank accounts in the name of assessee's proprietorship concerns, namely M/s. Om Suppliers, Ms. Balaji Garments, M/s. Ambika Trade ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al deposits and withdrawal on difference dates, however, the deposits in a particular account other than the initial deposit referred above was lying in my account for not more than two working days, which is the period of rotation of funds. Thus, my own funds in the account can only be considered as peak balance. It is important to mention that my peak balance referred to above of ₹ 10,81,450- represent partly my past savings and the balance being part of accumulated undisclosed earnings as per details below:-- Out of past savings ₹ 7,05,000- Undisclosed commission income ₹ 3,76,450- ₹ 7,05,000 Since ₹ 3,76,450- has already been covered in my commission income offered in my return, I am voluntarily off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome Tax Department during the search). Thus the peak balance has been calculated as under:-- Thus my peak balance comes to ₹ 10,81,450-. It can be seen that the bank account contain substantial deposits and withdrawal on difference dates, however, the deposits in a particular account other than the initial deposit referred above was lying in my account for not more than two working days, which is the period of rotation of funds. Thus, my own funds in the account can only be considered as peak balance. It is important to mention that my peak balance referred to above of ₹ 10,81,450- represent partly my past savings and the balance being part of accumulated undisclosed earnings as per details below:-- Out of past savings &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e course of search operation it was gathered that the appellant was maintaining bank accounts in the name of his proprietorship concerns and, admittedly, these bank accounts were undisclosed. There is also no dispute on the fact that the appellant was engaged in the activity of providing accommodation entries to various beneficiary parties. That, the appellant used to deposit the cash in his bank accounts and issuing the cheques to be reached to ultimate beneficiaries. In the bank accounts the cheques were also deposited which were received by the appellant from the persons working in the chain of providing accommodation entries. It is claimed by the appellant that he was receiving the commission for the services rendered to the beneficiari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essed in his hands. In support of this plea, the appellant relied on various decisions of ITAT, Kolkata. The appellant worked out the peak credit at Rs,1,00,000/- and offered the same for tax. The AO, in principle accepted the contention of the appellant that in his case peak credit theory is applicable to assess the income. However, he did not accept the contention of the appellant that provisions of section 68 are not applicable in his case. He also did not accept the working of peak credit provided by the appellant to offer the sum of ₹ 1,00,000/-for tax. The AO was of the opinion that the appellant has simply offered the amount of initial deposits made in the bank accounts, as peak balance. After rejecting the working of the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red all the entries of the bank accounts to arrive on the figure of peak. Under the circumstances, I find no reason to disturb the peak amount arrived by the AO to make the addition to the income of the appellant and, therefore, the action of the AO making addition of ₹ 5,05,000/- is upheld. I am also not inclined to agree with the submission of the appellant that if once the AO has added peak credit, then the commission income cannot be added to the income of appellant. There is no dispute on the fact that the appellant had earned commission income which was admitted by him and accordingly also disclosed in the return of income. In view of above, the addition on account of commission income is also confirmed. The ground Nos. 1, 2 and ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
