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2021 (7) TMI 1184 - ITAT BANGALOREAddition u/s 40A(2) - excessive payment made to its director - HELD THAT:- In the present facts of the case, assessee paid to its director salary and commission being percentage of the profits earned. We find that expenditure was claimed by assessee on account of payment of salary and commission to the director which is not in violation of any prevailing provisions of the Act. Further, it is also stated that the director to whom the payment was made by assessee is also paying taxes being in the highest tax bracket. Facts before us are similar to decision relied by the Ld. AR which has not been refuted by the revenue. In the present fact, Revenue has not made out any cases of tax evasion. However in the interest of Justice we remand this issue back to the Ld. AO only to verify the rate of tax applicable to the director during the year under consideration and to consider the claim of assessee in accordance with the various ratios laid down - Decided in favour of assessee.
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