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ACIT Versus Mrs. Vasanthy Natrajan

2015 (6) TMI 90 - ITAT MUMBAI

Addition made on account of commission / brokerage - assessee has failed to produce evidences to show that the deductors have reversed the entries wrongly made by them in their original TDS returns by way of its revision - CIT(A) deleted the disallowance - Held that:- CIT(A) did not commit any error in granting appropriate relief to the assessee. Right from the beginning it was the case of the assessee that it had earned total commission of ₹ 1,91,84,002/- from both the parties and confirm .....

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able to submit TDS certificate also in which correct amount was shown - Decided against revenue.

Disallowances of various expenses - CIT(A) deleted the disallowance - Held that:- Disallowance deleted by learned CIT(A) is on the submissions and explanation submitted by the assessee and some of the disallowances have been upheld on the basis of estimate. Keeping in view of the entirety of the facts mentioned above and also fact that the assessee has shown net profit @ 78.92%and also fac .....

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Shri I.P. Bansal And Shri Rajendra JJ. For the Appellant : Dr. P. Daniel For the Respondent : Shri Pawan K. Birla ORDER Per I.P. Bansal (JM):- This appeal filed by the Revenue is directed against the order passed by learned CIT(A) dated 7.6.2012 for A.Y. 2009-10. Grounds of appeal read as under :- 1.On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in disallowing the addition made by the AO on account of commission / brokerage of ₹ 2,26,54,449/- without .....

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ciating the fact that the said expenses were incurred by the assessee in cash and inspite of sufficient opportunities has failed to produce bills/vouchers in support of these expenses and other details like names and addresses of the persons to whom the payment for these expenses were alleged to be made." 3."On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in restricting the disallowances made by the AO on account of books & periodicals expense .....

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es of the case and in law, the Ld. CJT(A) has erred in restricting the disallowances made by the AO on account of travelling & conveyance expenses of R5. 3,68,332/- to 10% as against 25% without appreciating the fact that the assessee inspite of sufficient opportunities has failed to establish the co-relation between income and expenditure as claimed by her under this head with supporting documentary evidences." 5."On the facts and in the circumstances of the case and in law, the L .....

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4,002/- from Twinkle Envirotech Ltd. and Royal Twinkle Star Club Ltd. and net profit before tax was declared at ₹ 1,51,39,106/-. From the details generated from ITS, it was found by the Assessing Officer that the assessee had received brokerage income of ₹ 2,73,97,631/- from Twinkle Envirotech Ltd. and ₹ 1,84,05,979/- from Royal Twinkle Star Club Ltd. Thus, total difference between the brokerage shown by the assessee in her profit and loss account and details generated from the .....

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id not accept such submission of the assessee on the ground that the assessee has failed to produce documentary evidence that the two companies from whom the assessee has received commission have reversed the entries wrongly made in the original TDS return by way of return of original TDS return. Therefore the Assessing Officer made the addition of ₹ 2,26,54,449/-. Addition was challanged before learned CIT(A) and similar submissions were made. Learned CIT(A) after going through the detail .....

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have rectified these entries by reversing these entries. Correct payment of commission has been uploaded into system. These figures tally with the commission actually received by the appellant. The correct commission received from Twinkle Envirotech Ltd. amount to ₹ 1,14,16,452/- and from Royal Twinkle Star Club ₹ 77,67,5501-. Hence there is no discrepancy. 2 Letters were written from this office to M/s.Twinkle Envirotech and M/s,Rcayl Twinkle Star Club for confirming the actual comm .....

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rtmental Representative relying upon the order passed by the Assessing Officer submitted that the addition was rightly made and learned CIT(A) has wrongly deleted the same. It was submitted that the order passed by learned CIT(A) should be set aside and that of the Assessing Officer be restored. 6. On the other hand it was submitted by ld. AR that the conformation received from both the parties are filed at page No. 1&2 of the paper book alongwtih Form No. 26AS, copy of which is filed at pag .....

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laim simply on the ground that the evidence regarding reversal of the entries was not filed by the assessee in respect of the two companies from whom commission has been received. It was submitted that in view of the Form 26AS, there was no need to file any such evidence. Thus, it was submitted by ld. AR that addition has rightly been deleted by learned CIT(A) and his order should be upheld. 7.We have heard both the parties and their contentions have carefully been considered. After careful cons .....

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by the assessee from the parties then without verifying the same the Assessing Officer could not add any further amount to the income of the assessee without discarding evidence submitted by the assessee in the shape of the confirmation. Later on the assessee was able to submit TDS certificate also in which correct amount was shown. In view of these evidences, we are of the opinion that there is no infirmity in the order passed by learned CIT(A). Therefore we dismiss ground No. 1. 8.Ground No. 2 .....

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was further observed by learned CIT(A) that the said amount can consists of initial membership fees paid back or discount given to nearly 600 persons in respect of whose membership assessee has earned commission and these amounts range from 1600 to 2100 and cannot adequately vouched. The list of members in respect of whom commission paid was already submitted to the Assessing Officer. On these facts learned CIT(A) observed that the entire expenses cannot be disallowed. The assessee had discharge .....

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Ld. DR relied on the order passed by AO & submitted that Ld. CIT(A) has committed an error in granting relief to the assessee. 11.On the other hand, it was submitted by ld. AR that the complete details of name of persons were submitted to the Assessing Officer and these details are comprised at page No. 14 to 24 of the paper book. It was submitted that the amount ranges from 1600 to 2100 and assessee has earned huge commission from those persons. Thus, it was submitted that after appreciatin .....

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evidence to prove incurrence of expenditure. Before learned CIT(A) it was submitted that for earning commission in respect of fund mobilizing, commission agents have been assigned, certain responsibilities for which the assessee had to maintain office at several places to offer customer service and also to pay some portion of the commission back. It was also submitted that the net profit declared by the assessee on the entire receipt of ₹ 1.91 crores is 78.92%, therefore disallowance made .....

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cle, car depreciation and periodicals/printing and stationery, meeting expenses, travelling and conveyance. He also upheld the disallowance to the extent of 20% in respect of gift expenses. Learned CIT(A) has also taken into consideration that according to the CBDT Instruction No.225/26/2006-ITA-II(Pt.) dated 8.9.2010, wherein guidelines for completion of scrutiny assessment selected on the basis of AIR information laid down and if disallowances are made in excess of ₹ 10 lakhs, then the A .....

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