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2021 (12) TMI 704 - AT - Income TaxDisallowance of consultation fees on an adhoc basis - assessee company is engaged in the business of trading in computer hardware, software products and services - This is the second round of proceedings before this Tribunal - In the first round of proceedings, Tribunal had set aside this issue to the file of the AO for denovo consideration - assessee had always pleaded that these technicians had possessed requisite skill sets and the assessee had been using their services on hire basis as and when there is a requirement instead of providing employment on a permanent basis to them - HELD THAT:- Assessee had always pleaded that these technicians had possessed requisite skill sets and the assessee had been using their services on hire basis as and when there is a requirement instead of providing employment on a permanent basis to them. AO identified eight parties to be produced before him in the remand proceedings and they were all produced by the assessee along with their affidavits before the ld. AO. These parties are listed in page 3 of the ld. CIT(A)’s order. Apart from this, the assessee also furnished the chart showing the details of sales / service charges received, consultancy charges claimed, consultancy charges allowed and consultancy charges disallowed by the ld. AO from A.Yrs. 2003-04 to 2008-09. AO had sought to disallow the consultancy charges on an estimated basis only during the year under consideration and no disallowance was made either in earlier years or in subsequent years. Even going by the rule of consistency as upheld in the case of Radhasaomi Satsang [1991 (11) TMI 2 - SUPREME COURT] when there is no change in the facts and circumstances of the case, the Revenue is not bound to take a divergent stand during a particular year alone. Admittedly, the modus operandi practiced by the assessee had not changed in hiring of consultants on need basis and deploying them at the respective client location to render services on behalf of the assessee and remunerate them in the form of consultancy charges. The books of accounts produced by the assessee had not been rejected by the lower authorities. The assessee had furnished all the relevant documents that could be filed to prove the genuineness of consultancy charges from its side. The ld. AO had not pointed out any defect in the said details or had not found any defect in the books produced by it together with supporting evidences. Hence, there cannot be any justification on the part of the lower authorities to make any disallowance of expenses on an estimated basis. - Decided in favour of assessee.
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