Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2012 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (2) TMI 521 - AT - Income TaxTrading addition - applying GP rate of 25.5% or 25.01% - Held that:- Where provisions of section 145(3) is attracted, then addition should be made taking into consideration the past history of the case. Past history is that assessee declared 24.92% in the last year and in this year GP rate declared is 25.01%. Taking into consideration this aspect and taking into consideration that certain purchases remained unverifiable, we are of the view that if a trading addition of ₹ 4,00,000/- is sustained that will meet the ends of justice. We order accordingly. Ground of the assessee is allowed in part and ground of the department fails. Disallowance of commission expenses - appeal of the assessee was allowed in part by the ld. CIT (A) as he restricted the disallowance of commission @ 20% to the parties whose summons under section 131 could not be served - Held that:- In the year under consideration, there are five parties which were involved for assessment year 2006-07 to whom the commission was paid. Total commission paid to these parties was ₹ 5,83,763/- as ld. CIT (A) restricted the disallowance @ 20% on this commission on the basis of his finding for A.Y. 2006-07. Order of ld. CIT (A) for A.Y. 2006-07 was confirmed by the Tribunal. Facts are similar for the year under consideration. Accordingly we confirm his finding on this issue. The ground of the assessee as well as ground of the department fails. TDS u/s 194H - Disallowance under section 40(a)(ia) - non deduction of tax on service fees retained by the bank on credit card transaction - Held that:- There is no such relation between the bank and the shop keeper which establishes the relationship of a Principal and Commission Agent. Technically it may be written that bank will charge certain percentage of commission but this is not a commission because assessee sells its goods against credit cards, and on presentation of bills, the bank has to make the payment. It is not the case that bank has advised the assessee to sell their goods to its customers then he will pay the commission. It is reversed in a situation as bank issued credit cards to the credit card holders on certain fees or whatever the case may be and the card holder purchases material from the market through his credit card without making any payment and that shop keeper presents the bill to the bank against whose credit card the goods were sold and on presentation of bill as stated above the bank makes the payment. Therefore, in our considered view, provisions of section 194H are not attracted in this type of transaction. Therefore, we hold that addition made and confirmed by ld. CIT (A) was not justified. Appeal of the department is dismissed.
|