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2023 (3) TMI 48 - AT - Income TaxDisallowance of commission on the sale value - commissions payment which is more than the reasonable rate of commission in the real estate business - AO disallowed in excess of 2% of the sale value of flats - CIT(A) confirming the addition being paid over and above @ 2% of agreement value of sale of flats - HELD THAT:- CIT(A) upheld the addition by concurring the action of assessing officer. Before us, assessee has not given any convincing factor for making payment of such commission, which is not the prevailing in the real estate business, except making submissions that it was incurred/ paid wholly and exclusively for the purpose of business. In our view the assessing officer rightly disallowed the commissions payment which is more than the reasonable rate of commission in the real estate business. Thus, the ground No. 1 of the appeal is dismissed. Disallowance of commissions expenses - such commission was paid for purchase of land, however, no such land is shown in the asset side in the balance sheet - HELD THAT:- We find that ld CIT(A) that confirmed the addition by holding that no land was purchased by assessee during the year. The plea of typographical error ‘commission paid for land’ is self-serving statement of assessee and made to wriggle out of situation when the assessing officer pointed out the discrepancy. As noted earlier, before us, the ld AR for the assessee has vehemently argued that when genuineness of such expenses were not in doubt and expenses incurred wholly and exclusively for the purpose of assessees business, same should be allowed and reasonableness of the expenditure has to be checked from the point of view of businessman. We are not convinced with the submissions of the ld AR for the assessee, when the commissions expense is wholly unreasonable and the assessee has taken such stand that the alleged commission was paid for purchase of land and in fact no such land was admittedly purchased during the year, the revenue authority cannot examine the reasonableness of the expenses on peculiar facts of the case. Therefore, we do not find any reason to interfere with the finding of the present case. In the result, this ground of appeal is also dismissed. Appeal of the assessee is dismissed.
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