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2016 (5) TMI 106 - ITAT MUMBAIDisallowance of commission payment - Held that:- The impugned disallowance merits deletion as these payments have been made by the assessee on behalf of its clients and, hence, the same does not constitute its own expenditure. Even though the assessee has routed the expenditure and reimbursement received from its clients through the profit and loss account, yet it is settled principle that the books of account of the assessee cannot be the sole determinative factor to decide about the nature of expenditure.According to the assessee, the commission payments have been made to the workers as an incentive to get the work done quickly. Even though the Assessing Officer has invoked the provisions of the Explanation to section 37(1), he has not cited the relevant law, which prohibits such kind of payments. According to the learned authorised representative, it is a prevailing trade practice and such payments are not prohibited by any law. The assessee's claim that it was paid to the workers have not been disproved. Even otherwise, we have noticed earlier that the same represents payments made on behalf of its clients and, hence, the disallowance of the same is not called for in the hands of the assessee. - Decided in favour of assessee
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