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2018 (1) TMI 244 - ITAT KOLKATAAddition on account of commission expenses paid to Directors - Held that:- Since, the commission to the Managing Director was payable by the assessee company on the profits and the profits for the financial year 2009-10 was determined only in the year under consideration after finalizing the account. The allowability on account of commission was crystallized in the year under consideration and the Ld. CIT(A) in our opinion was fully justified in allowing the same. We do not find any infirmity in the order of Ld. CIT(A) on the issue and upholding the same. We dismiss the ground no.1 of the Revenue appeal. Disallowance u/s 40(a)(ia) - payments made to foreign shipping lines without deduction of tax at source - Held that:- As clarified by the CBDT vide its circular No. 723 dated 19.09.1995 (copy at page no. 11 of the paper book), the provisions of section 172 are applicable in the case of Foreign Shipping Companies notwithstanding anything contained in the other provisions of the Act and therefore, the provision of Section 194C and 195 relating to tax deduction at source are not applicable in such cases. As further clarified by the CBDT, where payments are made to shipping agents of non-resident shipping owners for carriage of passengers etc. shipped at a port in India, the agents step into the shoes of the principal and accordingly the provision of section 172 shall apply and not the provisions of Section 194 and 195. The issue in the present case relating to the disallowance u/s 40(a)(ia) thus is squarely covered by the CBDT Circular No. 723 dated 19.09.1995 and even the Ld. DR has not been able to dispute this position. We therefore, find no infirmity in the impugned order of the Ld. CIT(A) deleting the disallowance made by the AO u/s 40(a)(ia) by relying on the said circular issued by the CBDT and upholding the same, we dismiss the ground no. 2 of the Revenue appeal. Addition on account of bad debts written off - AO held that it was a back dated entry made by the assessee company in its books of accounts and the actual decision to write off the bad debts having been taken only in the previous relevant Assessment year 2012-13 - Held that:- The relevant bad debts were written off by the assessee company in its books of accounts of the year under consideration and his position was not disputed by the AO although the relevant entry was done by him as a back dated entry. As per the relevant provisions contended section 36(1)(vii) the condition stipulated for the allowability of deduction on account of bad debts written off is that the relevant bad debts should be written off as irrecoverable in the account of the assessee for the previous year and in our opinion, this condition having been fulfilled by the assessee company, it was entitled for deduction on account of bad debts written off as rightly held by the Ld. CIT(A). We therefore, find no infirmity in the order of Ld. CIT(A) giving relief to the assessee on this issue and upheld the same. We dismiss the ground no. 3 of the revenue appeal. Disallowance of assessee’s claim made during the assessment proceedings without filing revised return - claim u/s 41 - Held that:- the position of law as explained and clarified by the Hon'ble Supreme Court in the case of Goetz (India) Limited [2006 (3) TMI 75 - SUPREME Court] is clear that the appellate authorities such as the Ld. CIT(A) is sufficiently empowered to entertain and consider the new claim made by the assessee on merits even without there being any revised return filed by the assessee making such claim. At the time of hearing before us the Ld. DR has also not disputed on this position. He has not raised any arguments on merit on this issue. As the AO himself in the assessment order had accepted the claim of the assessee on merit and the same was disallowed by him only for want of revised return. No infirmity in the impugned order of the Ld. CIT(A) giving relief to the assessee on this issue and upholding the same. We dismiss the ground no. 4 of the revenue appeal.
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