INCOME TAX ACT, 1961

Section 132

Search and seizure - AO alleged that assessee deployed its funds in form of share capital with huge share premium with various companies by providing bogus accommodation entries - Benefit of telescoping of commission income -

Search action under section 132 was carried out at various premises of S. Various documents belonging to assessee company were also seized from computer of S indicating transactions with assessee company. AO alleged that assessee deployed its funds in the form of share capital with huge share premium with various companies by providing bogus accommodation entries with the help of S to various parties and addition for commission income was made. Assessee sought benefit of telescoping the commission income with the income declared in the return.Assessee contended that commission income should be restricted only to transactions with outside companies and not to transactions with group companies controlled by C. Held: Case of assessee was that since the issue of allowing telescoping of commission income against the income declared in books of account was covered issue thus, the telescoping shall be allowed. There was force in the aforesaid argument of assessee and in view of the decision of this Tribunal for assessment year 2011-12 where the benefit of telescoping was granted, AO was directed to allow telescoping of commission income against income declared in the books of account for all the assessment years.

REFERRED : Dy. CIT v. M/s. Empower India Ltd. 2019 TaxPub(DT) 7531 (Mum-Trib).

FAVOUR : In assessee's favour

A.Y. : 2008-09 to 2014-15

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