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2018 (3) TMI 42 - ITAT MUMBAIAllowable busniss expenses - Diversion of income - payment for services rendered by M/s Vanguard Jewels Ltd - proof of commercial expediency - Held that:- In the present case, the assessee was a lady business person. She has received a huge export order. She sought help and assistance from M/s. Vanguard Jewels Ltd. who had earlier sufficient experience in dealing the export business. The facts of the case clearly indicate that the considerable service was provided by M/s. Vanguard Jewels Ltd. Under these circumstances, the order of the Assessing Officer that no amount was payable is not at all sustainable. Though the amount has been received by the assessee, the same is collected on behalf of the joint venture. There was a subsisting agreement with M/s. Vanguard Jewels Ltd. CIT (Appeals) has found that all the expenditure has been incurred out of the sums received from the consignee and no expenses have incurred by the assessee from her own funds. The mere accounting entry by which the entire receipt has been shown in the credit side and the payment to M/s. Vanguard Jewels Ltd. shown in the debit side cannot alter the substance of the transaction that it is a payment of the joint venture and there is an overriding title of M/s. Vanguard Jewels Ltd. in the said sum. It is the settled law that the accounting entries are not determinative of the actual nature of the transaction; it is the substance that prevails. - Decided in favour of assessee
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