TMI Blog2016 (6) TMI 928X X X X Extracts X X X X X X X X Extracts X X X X ..... rify the subsequent settlement made by the assessee to the concerned sundry creditor and if proved, no addition need to be made by the Learned AO. - Decided in favour of revenue for statistical purposes. Disallowance of brokerage payment - Held that:- We find from the confirmation letters of 5 suppliers that they had categorically stated that the assessee was introduced to them through a broker. The broker in the instant case needs to be understood only as M/s Timespac India Ltd. The revenue was not able to produce any contrary evidence in this regard. However, we agree with the contention of the Learned DR that these confirmations were dated in the fag end of December 2011 from different locations in India, it would not have reached the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y Associates by issuing notice u/s. 133(6) of the Act. Since no satisfactory reply was received from the party the AO required explanation in this regard from the assessee. The assessee submitted that this was the balance amount being carried forward from FY 2008-09. The AO without making further reference in this respect to the assessee treated the amount as unexplained and thus added in computing the total income of the assessee. The assessee claimed that there was transaction in the nature of purchase from the said party M/s Peekay Associates which remained unpaid as on 31.3.2009 and hence reflected as sundry creditors in the balance sheet as on 31.3.2009. The assessee stated that the same was fully settled in the subsequent year . The L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... voked towards cessation of liability only in the event of revenue proving the fact of assessee deriving some benefit out of this transaction. In the instant case , the assessee claims that the liability has been settled in the subsequent financial year which fact has not been verified by the Learned AO. Hence in the facts and circumstances, we deem it fit and appropriate, in the interest of justice and fair play, to set aside this issue to the file of the Learned AO , with a direction to verify the subsequent settlement made by the assessee to the concerned sundry creditor and if proved, no addition need to be made by the Learned AO. Accordingly, the ground no. 1 raised by the revenue is allowed for statistical purposes. 3. The next issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... odern Laminators Ltd. as bogus and fabricated with an intention to conceal the actual income. 3.2. Before the Learned CIT(A), the assessee stated as follows:- i) The assessee intended to purchase goods which fact was brought to the knowledge of the broker, M/s. Timespact India Ltd. ii) The broker, M/s. Timespac India Ltd., introduced the appellant with the parties ( sellers) like (i) M/s. Sri Narasimha Plastic Industries, (ii) M/s. Deccan Polypacks Ltd., (iii) M/s. Sipani Fibres Ltd., (iv) M/s. Salguti Industries Ltd. (v) M/s. Servo Packaging Ltd. etc. iii) The parties ( sellers) agreed to sell to the appellant as per its requirements and supplied the goods directly to the appellant which fact is apparent from the detail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mespac India Ltd who had introduced the assessee with the suppliers of goods. The genuineness of purchases made by the assessee from those parties were not disputed by the Learned AO and he further observed that it is not the case of the Learned AO that the commission paid to the party has flown back to the assessee. Accordingly he deleted the addition. Aggrieved, the revenue is in appeal before us on the following ground :- ii) Ld. CIT(A) has failed to appreciate the reason for considering the claim of brokerage payment amounting to ₹ 43,20,020/- as not genuine and has erroneously considered the report of the seller of making direct sale without involvement of any broker as the only reason for making such disallowance by the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee, though the purchases were accepted as genuine, the Learned AO had only disputed the payment of commission to M/s Timespac India Ltd in respect of such purchases. We find from the confirmation letters of 5 suppliers that they had categorically stated that the assessee was introduced to them through a broker. The broker in the instant case needs to be understood only as M/s Timespac India Ltd. The revenue was not able to produce any contrary evidence in this regard. However, we agree with the contention of the Learned DR that these confirmations were dated in the fag end of December 2011 from different locations in India, it would not have reached the Learned AO before the completion of assessment proceedings. Hence, in these fac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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