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2016 (5) TMI 294 - AT - Income TaxTDS u/s 194H - Disallowance u/s 40(a)(ia) - non TDS on commission expenditure - Held that:- Set aside this issue to the file of the Learned AO, to verify as to whether the payees have duly recorded the subject mentioned commission receipt in their returns and if so, in the light of second proviso to section 40(a)(ia) of the Act and in the light of the decision of the Hon’ble Delhi High Court in the case of CIT vs Ansal Land Mark Township (P) Ltd (2015 (9) TMI 79 - DELHI HIGH COURT ), the assessee herein should not be treated as assessee in default and hence no disallowance u/s 40(a)(ia) of the Act could be invoked in the hands of the payer (assessee herein). The assessee is directed to file the necessary documents and evidences before the Learned AO in this regard. - Decided in favour of assessee for statistical purposes. Disallowance of commission expenditure - Held that:- From the detailed order passed by the Learned CIT(A) and examination carried out by him, in the facts and circumstances, the assessee had not proved the genuineness of the transactions of commission expenditure together with the nature of services rendered by those 3 parties except self serving letter of engagement given by him to them. Even no evidence was furnished to prove as to whether such letter of engagement was indeed acknowledged by those three parties. The academic qualifications to prove the competency level of those three parties could also not be proved by the assessee. In these facts and circumstances, we find that the assessee had merely tried to use the names of his relatives and others to divert his taxable receipts and hence we find no infirmity in the order of the Learned CIT(A) - Decided against assessee. Disallowance of salary expenditure - Held that:- taking into account, the nature of activities of the assessee, it is highly improbable and impractical to conclude that the assessee could have carried on all the activities on its own to earn the consultancy charges / commission income. Definitely he requires the assistance of certain employees for carrying out certain secretarial activities and taking in view the totality of the facts and circumstances and more especially in view of the fact that no adverse remarks were made by the Learned AO in respect of ₹ 14,39,550/- (11089550-9650000) being the salaries actually paid before the end of the previous year by the assessee, we deem it fit and appropriate, to meet the ends of justice, to allow the salaries & wages claim to the extent of ₹ 14,39,550/-. We hold that the Learned AR was not able to controvert the findings of the Learned CIT(A) with any documentary evidences except placing reliance on the affidavits of wife and son which has been rejected by logical reasons. Hence on the balance sum of ₹ 96,50,000/- ( 11089550-1439550), we find no infirmity in the order of the Learned CIT(A). - Decided partly in favour of assessee
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