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2021 (3) TMI 269 - AT - Income TaxDeduction on account of sub-brokerage paid u/s 37 - Allowable business expenditure or not? - HELD THAT:- A.O. in the entire assessment order did not mention any details of the search conducted in the case of Shri Praveen Agarwal. The A.O. did not mention anything in the assessment order as to how the statement of Shri Praveen Agarwal was incriminating in nature against the assessee. Whatever documentary evidence was produced by the assessee before A.O. have not been doubted by the A.O. and no enquiry on the same have conducted by the A.O. Thus, its stand established that assessee being engaged in business of real estate has engaged M/s. Taral Vincom Pvt. Ltd., as sub-broker. The assessee paid the impugned amount to the sub-broker against Bill and copy of the ledger account of the sub-broker is filed before A.O. The impugned amount is paid through banking channel on which TDS has also been deducted. The assessee filed details to show that for how much deals, sub-broker has worked for the business of assessee which were noted in the assessment order. All these documentary evidences have not been doubted by the A.O, therefore, assessee has been able to prove that the impugned amount have been incurred wholly and exclusively for the purpose of business of assessee. A.O. did not bring any evidence on record to dispute the correctness of the documentary evidences filed by the assessee on record. The A.O. merely following the information received from the search of Shri Praveen Agarwal, disbelieved the explanation of assessee, but, such fact cannot be read in evidence against the assessee. The details of ledger account show that assessee has regular business with M/s. Taral Vincom Pvt. Ltd., which is supported by the activities conducted by them. The bills issued by assessee and copy of bills issued by M/s. Taral Vincom Pvt. Ltd., show complete details as to for which property the transactions have been conducted by the sub-brokerage, for which commission have been paid to M/s. Taral Vincom Pvt. Ltd. The documentary evidences on record clearly suggest that assessee entered into the genuine business activities with the sub-broker and sub-broker rendered services for the business activity of the assessee. In the Group Case the Ld. CIT(A) has already deleted the similar addition finding the commission payment made to the same sub-broker as genuine - Decided against revenue.
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