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TMI Blog2021 (7) TMI 445X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 32,00,000/- as against the returned income of the assessee of ₹ 7,00,200/-. Consequently, the returned income of the assessee ₹ 7,00,200/-, the addition made by the Ld. AO of ₹ 94,04,800/- and the enhancement of the income by the Ld. CIT (A) of ₹ 5,76,98,279/- shall stand deleted. Appeal of the assessee is partly allowed - ITA No. 179/Hyd/2019 - - - Dated:- 28-6-2021 - Smt. P. Madhavi Devi, Judicial Member And Shri A. Mohan Alankamony, Accountant Member For the Assessee : Shri T. Chaitanya Kumar For the Revenue : Shri Rajendra Kumar, DR ORDER PER A. MOHAN ALANKAMONY, A.M: This appeal is filed by the assessee against the order of the Ld. CIT(A)-7, Hyderabad in appeal No. 0168/CIT( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ile the turnover with the cash deposited in his bank account. Therefore the Ld. AO treated the net cash deposit in assessee s bank account of ₹ 94,04,800/- as his income and made addition. 5. On appeal, the Ld. CIT (A) sustained the order of the ld. AO by agreeing with his view. Further, with respect to the turnover of the assessee of ₹ 79,34,850/- declared in his return of income the Ld. CIT (A) noticed that the assessee had deposited an aggregate of ₹ 53,75,11,279/- including the cash deposit of ₹ 1,44,09,200/- in the four bank accounts maintained by the appellant. On query the assessee had furnished detailed explanation vide letter dated 27/08/2018. The aforesaid letter is extracted herein below from the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ofit margin from the said business is @ 11.20% which arrived based on the profit declared by me in my tax returns. In this regard, I would like to bring to your kind attention that, the total consultancy income declared in my tax return represents the margin received from various customers after completion of transaction/ deal, i.e by considering all my bank transactions. We have disclosed the same as our gross consultancy and from which I have offered net profit of ₹ 8,89,200/- after deduction all indirect expenses. 5. Further, we would like to inform you that in present business scenario, no business will give such huge profit margin of ₹ 11.20% like you mentioned in the show case notice. 6. Without prejudicial to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00/- along with the admitted income disclosed in the return of income of 7,00,200/- aggregating to ₹ 1,01,05,000/-. 7. Before us, the Ld. AR vehemently argued by stating that the assessee s business was only arranging finance for his clients which were obtained by him through known sources against which he was receiving commission income between 0.25% to 0.5% on the fund arranged to his clients. He further submitted that the commission received was by way of cash and the same was deposited in his bank account. Further he also clarified that the entire amount of finance procured by him was by cheque which was deposited in his bank account and thereafter handed over to his clients by way of cheque payment. To substantiate the same th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the clients of the assessee baring nominal amount which was to be subsequently funded to the clients of the assessee. Further there are few cash deposits in the bank accounts which the assessee has admitted that it was part of his turnover pertaining to commission income as the same were received in cash, own funds and petty funds arranged. The ld. AO has also accepted that the assessee was only earning commission income and therefore he has ignored the funds received by the assessee through bank as his income as it was further advanced to various parties, while estimating the additional income of the assessee at 94,04,800/-. The Ld. CIT (A) has also not made any contrary finding on this regard. In these circumstances, the conclusion of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e above mentioned estimate of commission income earned by the assessee during the relevant assessment year seem to be reasonable. Hence, we are of the considered view that on the overall, the assessee s income should be estimated and assessed at ₹ 32,00,000/- (by r/o ₹ 31,38,600/-) worked by us hereinabove. Accordingly, we hereby direct the Ld. AO to assess the net taxable income of the assessee at ₹ 32,00,000/- as against the returned income of the assessee of ₹ 7,00,200/-. 9. Consequently, the returned income of the assessee ₹ 7,00,200/-, the addition made by the Ld. AO of ₹ 94,04,800/- and the enhancement of the income by the Ld. CIT (A) of ₹ 5,76,98,279/- shall stand deleted. 10. In the re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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