9911796707
TMI Blog2012 (5) TMI 286X X X X Extracts X X X X X X X X Extracts X X X X ..... oresaid addition, the assessee has come out with the appeal under Section 260A of the Income Tax Act. 3. The submission raised is that payment of commission paid by the assessee to Shri Uttam Chand Jain and Smt. Sunita Jain, who are son and daughter-in-law, ought not to have been added. It was a business expenditure. 4. Shri Agrawal has submitted that the documents on record prove that the amount paid to Shri Uttam Chand Jain and Smt. Sunita Jain was towards commission as such business expenditure, though they were related in the capacity of son and daughter-in-law of the assessee. The Assessment Officer. Commissioner of Income Tax (Appeals) and Income Tax Appellate Tribunal have erred in not treating the same as business expenditure. 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs, the assessee has not shown any payment of brokerage to the investor concern and it has only shown payment of brokerage to his family members. Thus, the AO observed that this payment of brokerage to family members is as per the convenience of the assessee on pick and choose method and that also without any basis and justification. The AO has gone to the extent of observing that the assessee has apparently done so to divert his income to his family members, which would otherwise become taxable in his own hands, whereas Shri Uttam Chand Jain and Smt. Sunita Jain are having huge brought forward loss, where the income so diverted is adjusted against huge loss. The AO vide another letter dated 9-1-06 along with notice u/s 147(1) has given one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee has net shown any payment of brokerage to the investor concerned and it has only shown payment of brokerage to his family members. It has been found by the Assessment Officer that it has been done to divert his income to his family members which would have otherwise become taxable in his own hands. Shri Uttam Chand Jain and Smt. Sunita Jain were having huge brought forward loss. The income was also diverted as against the huge loss. Provisions of Section 40A(2)(b) of the Act has been attracted. 7. Shri Agrawal has relied upon the decision of the Madras High Court in CIT v. Computer Graphics Ltd. [2006] 285 ITR 84/155 Taxman 612 in which the decision was based upon the material which was placed on record so as to treat the pay ..... X X X X Extracts X X X X X X X X Extracts X X X X
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