Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2013 (3) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (3) TMI 196 - AT - Income TaxGenuineness of Commission paid to Directors - AO stated that assessee company failed to substantiate that commission was paid to Directors wholly and exclusively for the purpose of business and accordingly, disallowed an amount of Rs. 22,71,543/- - held that:- Assessee company has no managerial/other official as whole time employee save and except the staff in clerical section. - It is a fact that assessee company is an artificial entity and acts through natural person. Therefore assessee herein is acting through its non-whole time directors for complying with legal requirements and other Acts as applicable to a corporate entity besides interacting to carry out its business. - The payment of commission by assessee company is to its whole time directors is to facilitate and to carry out on its business. - Thus the payment commission by assessee company is wholly and exclusively for business purposes and same is allowable. - Decided in favor of assessee. Payment to adverting agency - The AO stated that payment has no relevance to the business affairs of assessee. There were personal relations existed - held that:- There is no document on record as well, to justify the payments that it was made for business purposes. Considering the facts of the case and in the absence of any material on record, we do not find any infirmity in the order of authorities below. - Decided against the assessee.
|