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IN THE INCOME TAX APPELLATE TRIBUNAL

“K (SMC)” BENCH, MUMBAI

SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER

SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER

ITA No.3621/Mum/2025

(Assessment Year:2014-2015)

Income Tax Officer 42(1)(3), Mumbai

Room No.735, 7^th Floor, Kautilya Bhavan,

C-41 to C-43, G Block, Bandra Kurla Complex,

Bandra (East), Mumbai – 400051 …………. Appellant

Vs

Madhusudan M. Jani HUF

B/22, Plot No.11, Ajnikyatara CHS Ltd.,

Gorai-1, Borivali (West), Mumbai – 400092

Maharashtra. …………. Respondent

PAN:- AAIHM8444E

Appearance

For the Appellant/Revenue : Shri Shrawan Kumar Jha

For the Respondent/Assessee : Shri Bhagirath Ramawat

Date

Conclusion of hearing : 08.04.2026

Pronouncement of order : 21.05.2026

O R D E R

[

Per Rahul Chaudhary, Judicial Member:

1. The present appeal preferred by the Revenue is directed against the

Order, dated 25/03/2025, passed by the Additional/Joint

Commissioner of Income Tax (Appeals) – 1, Ahmedabad [hereinafter

referred to as the ‘CIT(A)’] whereby Learned CIT(A) had partly

allowed the appeal against the Assessment Order, dated 19/12/2017,

passed under Section 144 read with Section 147 of the Income Tax

Act, 1961 [hereinafter referred to as ‘the Act’], for the Assessment

Year 2014-2015.

2. The Revenue has raised following grounds of appeal:

“1. On the facts and circumstances of the case and in law, the

Ld.CIT(А) erred in restricting the addition of commission @2% of

ITA No.3621/Mum/2025

Assessment Year 2014-2015

Rs. 7218797/- representing accommodation entry, instead of

considering 2% of Rs. 1,39,95,833 as adopted by the AO.

2. On the facts and circumstances of the case and in law, the

Ld.CIT(A) has not considered that while calculating commission

on accommodation entry, the AO has duly taken into

consideration the debit and credit side of the transactions.

3. On the facts and in the circumstances of the case, the Hon'ble

ITAT is requested to entertain this appeal, though, the tax effect

is below the monetary limit prescribed in the CBDT Circular

No.5/2024 Dt.15.03.2024 but the case falls within the exceptions

laid down in clause (h) of Para 3.1 of the Board's Circular

No.5/2024 Dt. 15.03.2024.".”

3. The relevant facts in brief are, the Assessee is a HUF, filed a return of

income for the Assessment Year 2014-15 on 24-08-2015 declaring

income of INR 2,34,439/-. On the basis of the information received

from the Deputy Director of Income Tax (Investigation), Unit-7-(4),

Mumbai, to the effect that the Assessee was one of the entities,

controlled and managed by Vipul Vidhur Bhatt, engaged in providing

accommodation entries, reassessment proceedings were initiated u/s

147 of the Act in case of the Assessee. The aforesaid reassessment

proceedings culminated into passing of the Assessment Order dated

19.12.2017 u/s 142 Read With Section 147 of the Act. The Assessing

Officer concluded that the Assessee was engaged in providing

accommodation entries for commission, taking 2% as the rate of

commission, the Assessing Officer computed commission income at

INR 2,79,917/- taking the debit and credit entries into consideration

(2% of INR 1,39,95,832/-)

4. Being aggrieved the Assessee, preferred the Appeal before the

Ld.CIT(A). Since, no details/documents were furnished by the

Assessee during the assessment proceedings in relation to the

assessment made, the Assessee filed additional evidence taking

refuge under rule 46(A) of the Income Tax Rules, 1962 (‘IT Rules”).

It was contended on behalf of the Assessee that the commissioned

income of the Assessee should be calculated using commission rate of

2

ITA No.3621/Mum/2025

Assessment Year 2014-2015

0.2% on debit entries only. The Ld.CIT(A) declined to interfere with

the order passed by the Assessing Officer estimating commission rate

at 2%. However, the Ld. CIT(A) granted relief to the Assessee by

restricting the addition to INR 1,44,375/- (being 2% of

accommodation entries of INR 72,18,797/-) Thus the Ld.CIT(A)

deleted addition made by the Assessing Office to the extent of INR

1,35,541/- vide Order dated 25.03.2025.

5. Bei