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TMI Blog2010 (5) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal in ITA No. 1952/Del/2008 relating to the assessment year 2003-2004. 2. The assessee was before the Tribunal in the aforesaid appeal being aggrieved by an order passed under Section 263 of the Income Tax Act, 1961 (hereinafter referred to as 'the said Act') by the Commissioner of Income Tax (Appeals). The provisions of Section 263 had been invoked by the Commissioner on the ground that the assessment order was erroneous and was prejudicial to the interest of the revenue. According to the Commissioner of Income Tax (Appeals), while calculating the book profits under Section 115JB of the said Act, sales commission of Rs 241.90 lacs claimed in the profit and loss account was not added back, even though this claim had been disal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is was so because, according to the Assessing Officer, the assessee company had violated the provisions of Section 294 of the Companies Act, 1956 by appointing the sole selling agent. The question of allowability of the sales commission was the subject matter of appeal before the Commissioner of Income Tax (Appeals), who held the same to be an allowable expenditure inasmuch as the same was incurred by the assessee for its business purpose. 4. The learned counsel for the respondent/ assessee informs us that after the decision of the Commissioner of Income Tax (Appeals), the revenue preferred an appeal before the Income Tax Appellate Tribunal but the said appeal was dismissed. Thereafter, no further appeal was filed before this Court on this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utory auditors to be in accordance with the Companies Act, 1956, it was not open to the Assessing Officer to go beyond the profits so declared except to the extent of making increases or decreases as per the Explanation to the said Section. It is not the case of the revenue that the Assessing Officer or the Commissioner of Income Tax was purporting to make any adjustments as provided under the Explanation. Consequently, the Tribunal was absolutely right in concluding that the provisions of Section 263 of the said Act could not be attracted because there was nothing erroneous in the original order passed by the Assessing Officer. The Tribunal has correctly placed reliance on the decision of the Supreme Court in the case of Apollo Tyres Ltd ( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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