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TMI Blog2022 (11) TMI 1167X X X X Extracts X X X X X X X X Extracts X X X X ..... ue. - I.T.A. No. 1583/Kol/2018 - - - Dated:- 21-11-2022 - Shri Sanjay Garg , Judicial Member And Shri Girish Agrawal , Accountant Member Shri Manish Tiwari , FCA , appeared on behalf of the appellant Smt. Ranu Biswas , Addl. CIT - DR , appeared on behalf of the respondent ORDER Per Sanjay Garg , Judicial Member : The present appeal has been preferred by the Department against the order dated 24.04.2018 of the Commissioner of Income Tax (Appeals)-7, Kolkata [hereinafter referred to as CIT(A) ] passed u/s 250 of the Income Tax Act (hereinafter referred to as the Act ). The Revenue in this appeal has taken the following grounds of appeal: 1. That on the facts and in the circumstances of the case, the Ld. CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of M/s Cellbiz Services. The assessee firm used to purchase recharge top-ups from various distributors of various telecom companies and further sold these to its own network of distributors. The assessee declared sales of Rs.8.54 crores during the year under consideration. During the assessment proceedings, the Assessing Officer noted that the assessee had debited a sum of Rs.86,27,87,110/- under the head purchase. The Assessing Officer further noted that the assessee firm had made cash purchase of Rs.7,20,27,038/- against which payment of Rs.6,95,06,092/- was paid by cash and the difference of Rs.25,20,946/- was claimed to be the commission out of the above transaction. The Assessing Officer held that the assessee had violated the provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... recharge business on behalf of different service providers like Airtel, Vodafone, BSNL, Docomo etc. by using a single sim provided by the assessee instead of using separate LAPU sim by each of the telecom services provider. The assessee in lieu of that takes part of the commission provided by the company to the retailers. The assessee in this way explained that the assessee not only buys back the LAPU sims from numerous retailers but also buys out their talk-time value. The assessee company also buys talk-time stock in bulk from big distributors and even from the company directly. It was explained that in the relevant financial year, the assessee has made bulk purchases of talk-time of Rs.79,07,60,072/-, wherein, all payments were paid by c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing one LAPU SIM for Airtel was getting a recharge talk time value of Rs.2.30 per Rs.100.00 of recharge. He not only had to maintain one LAPU sim and one. dedicated hand set, he had to maintain wallet with the Airtel Company comprising of say an amount of Rs.2,000/- of talk time per day. Similarly, he was getting commission from other operator as well by maintaining different but dedicated individual LAPU SIMs for each operator and also had to maintain different wallets. Imagine a hypothetical situation like this where the retailer by maintaining five wallets with five different Companies is actually engaging Rs.10,000/- of his capital per day and getting return thereby on it as recharge commission in form of talk time value. Now by subscri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e payment has exceeded the threshold limit of Rs.20,000/. The cash book, purchase register and all individual invoices where cash transaction had taken place have been thoroughly checked and it is found that not a single such transaction actually exceeds the threshold limit. In view of the same, the addition made by the A.O to the tune of Rs.7,20,27,038/- under section 4OA(3) of the Act is hereby deleted and the appeal of the assessee on this ground is treated as allowed. 4. After hearing the ld. representatives of the parties and after going through the record, we do not find any reason to interfere with the above order of the CIT(A). The ld. CIT(A) has categorically mentioned that the cash book, purchase register and all individual ..... X X X X Extracts X X X X X X X X Extracts X X X X
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