9911796707
TMI Blog2022 (9) TMI 241X X X X Extracts X X X X X X X X Extracts X X X X ..... the following grounds of appeal before this Tribunal :- 1. For that on the facts of the case, the order passed by the Ld. C.I.T.(A) on 01.04.2019 is completely arbitrary, unjustified and illegal. 2. For that on the facts of the case, the Ld. C.I.T.(A) was wrong in dittoing the order of the A.O. and confirming the addition of Rs. 1,00,00,000/- on account of Interest free advances treating the same as unexplained cash credit under section 68 of the IT. Act which is completely arbitrary, unjustified and illegal. 3. For that on the facts of the case, the Ld. CIT(A) was wrong in not considering the facts that the advances amounting to Rs. 1,00,00,000/- to Pragati Management issued on 23.08.2013 as short term interest free advances, moreo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the details of the cash creditors, namely, M/s. Yogmaya Distributors Pvt. Ltd. and M/s. Vilasini Sales Pvt. Ltd. Notices sent u/s 133(6) of the Act to both the cash creditors did not bring any satisfactory results. The assessee requested for further time to file other documents but subsequently, no such details were furnished. The ld. Assessing Officer proceeded to make the addition of Rs.1,00,00,000/- u/s 68 of the Act for unexplained cash credit mainly on account of the fact that M/s. Yogmaya Distributors Pvt. Ltd., denied to have entered into any transaction with the assessee. The ld. Assessing Officer also made minor disallowance u/s 14A of the Act at Rs.25,259/- and eventually assessed the total income of the assesse at Rs.1,00,28,660/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... poration to prove the identity of M/s. Yogmaya Distributors Pvt. Ltd. and M/s. Vilasini Sales Pvt. Ltd.. It was strongly contended that these were genuine loans and they were applied for giving interest free loan advances to M/s. Pragati Management. The ld. Counsel for the assessee also took an alternative plea that even if the assessee is considered as an accommodation entry provider, since the assessee has taken the loan and provided entry to M/s. Pragati Management for the equal amount, it has been held by the Hon'ble Jurisdictional High Court that in cases where the assessee is engaged in the business of providing accommodation entries only, the commission on such accommodation entries may be added to the income of the assessee. Relian ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red loan of Rs.1,00,00,000/- was given as a short term interest free advance to M/s. Pragati Management. According to the Assessing Officer, the assessee was unable to explain the unsecured loan of Rs.1,00,00,000/- referred above. To ascertain the same, the ld. Assessing Officer sought for the addresses of both the cash creditors and loan confirmations. The assessee complied and provided the addresses of both the parties. We find that the assessee had filed loan confirmation from M/s. Yogmaya Distributors Pvt. Ltd., signed by the Director of M/s. Yogmaya Marketing Pvt. Ltd., which has been taken note of by the Assessing Officer in the assessment order. Subsequently notice u/s 133(6) of the Act was issued to M/s. Yogmaya Distributors Pvt. Lt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same has been further advanced to M/s. Pragati Management. The assessee had discharged the initial burden of proof by filing the identity details, proving the genuineness of the transactions and financial statements of the alleged cash creditors to prove their creditworthiness. 11. Be it as it may, during the course of hearing, the ld. Counsel for the assessee submitted that even if the assessee is considered to be an accommodation entry provider then also, the addition can be made only for the element of commission earned on such accommodation entries provided and that the Hon'ble Jurisdictional High Court in the case of M/s. Safeco Projects Pvt. Ltd. (supra) has held that, such commission income on accommodation entries is only Rs. 250 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an be an element of commission income which the assessee might have earned for arranging such short term loans for M/s. Pragati Managment and without holding the assessee to be an accommodation entry provider. Thus, to end the dispute and without setting any precedence for the alleged transactions, we estimate income of the assessee @ 3% of the total loans advanced i.e., 3% of Rs.1,00,00,000/- which comes to Rs.3,00,000/- and direct the Assessing Officer to sustain the said addition and the remaining addition of Rs.97,00,000/- stands deleted. While doing so, at the cost of repetition, we hold that the decision rendered in the instant case shall not be taken as a precedence for other cases, since the view taken by us is purely based on the f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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