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2016 (8) TMI 691 - AT - Income TaxDisallowance of commission paid to agents - Held that:- The assessee had used the services of 15 agents and only 3 have declined to have made any services to the assessee. In the given case, there are certain issues such as there exist only oral agreements, the agents are from different field of activities and the customers are denying the presence of agents in the transaction. At the same time, the Revenue had investigated this issue independently without involving the assessee but it has carried out the investigation partially. There are some holes in this investigation. The first being the statements recorded from the 3 lady agents are stereo typed and the languages of all three are exactly similar. The Revenue has not brought out whether the agents who denied, has done any service to the assessee had filed their return of income, if filed, whether they have declared the commission as their income and taken the tax credit. In the absence of such details the case is peculiar and the assessee had submitted the details of the agents, who had agreed that they had provided services, the assessee must be given the advantage, even though there is no written agreement. Accordingly, we allow the commission to the extent of those agents who had confirmed before the Assessing Officer to have provided the service to the assessee and at the same time, we cannot overlook the point of view of the Department that the agents have declined to have any business connection with the assessee. Accordingly, we direct the Assessing Officer to allow the commission to the extent of 12 agents and uphold the disallowance of commission to the extent of 3 agents, who denied to have done any services to the assessee. - Decided partly in favour of assessee.
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