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2019 (1) TMI 1257 - ITAT DELHITDS liability on Expenditure incurred on the commission - reimbursement of expenses - payment exceeding permissible limit - Held that:- Except for handling charges, all other payments are nothing but reimbursement of expenses. On reimbursement of expenses, there is no liability for deducting tax at source. In so far as handling charges are considered, same totals to ₹ 41,950/- and as per the provisions of the Act, if total payment during the year does not exceed ₹ 75,000/, there is no liability to deduct tax at source, therefore, agree with the contention of the the assessee. On the given facts, the assessee is not liable for deducting tax at source. Therefore, disallowance made u/s 40(a)(ia) of the Act is uncalled for - Decided in favour of assessee Addition of sales commission - genuineness of the transaction and the purpose of paying sales commission to the two ladies - Held that:- There is no dispute that both the persons are assessed to tax and they have shown the sales commission in their respective return of income. There is also no dispute that the assessee has deducted tax at source as per the applicable rates. Assessing Officer is not the right person to decide which expenditure the assessee should incur in furtherance of his business. Secondly, the statements on oath, recorded by the Assessing Officer, which are placed in the paper book, thus find that both the ladies have specifically and directly explained the nature of transaction on which they have received sales commission form the assessee. When examination of both the ladies clearly established the service they have provided to the assessee, there remains no doubt that the payment is genuine - Decided in favour of assessee Adhoc disallowance made on account of expenses under the heard vehicle maintenance, interest on car loan, telephone expenses, travelling expenses and depreciation on car - AO disallowed 1/8th of the expenses so claimed - CIT(A) who restricted the disallowance to the extent of 1/10th of the expenses - Held that:- As personal element cannot be ruled out as observed by the CIT(A) and the first appellate authority has already given relief to assessee on this count. No interference is called for. - Decided against assessee.
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