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2014 (4) TMI 698 - AT - Income TaxDisallowance of commission on sales Manufacturing and trading of safety gloves and industrial safety products Held that:- The assessee had paid similar commission to ACL which has been accepted by the Department under the scrutiny proceedings u/s 143(3) - The nature of transaction on the domestic sales by the assessee through ACL is on account of ordinary course of business and it was a business expediency that the assessee had decided to make the sales in the domestic market through ACL - In the cases where sale has been made to ACL, then it has been made on pre-determined price and whatever further sales has been made by the ACL is not the concern of the assessee. It is prerogative of the businessman to conduct the business in the manner it suits its business expediency and necessity - the business expediency cannot be doubted looking to the overall transaction undertaken by the assessee through ACL - the genuineness of the payment is also corroborated by the fact that the assessee has deducted TDS on such a commission and has also deposited in the Government treasury - This leads to some credence about the genuineness of the commission of payment and its claim for deduction u/s 37(1) - the payment of commission to ACL is genuine business expenditure which has been paid on account of business and commercial expediency thus, the claim is duly allowable u/s 37(1) of the Act Decided in favour of Assessee.
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