Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

Shri Rajendra Agarwal Versus Asstt. Commissioner of Income Tax, Circle 10 (1) , Hyderabad

2016 (7) TMI 173 - ITAT HYDERABAD

Payment of commission - Held that:- From the orders of the subordinate authorities we arrive at our considered view that in the ledger a/c there is no definite rate of commission that is paid, the commission is not paid on weekly basis or monthly basis. We find that it is mostly paid towards the end of the year. It has been already decided by the subordinate authorities after thorough inquiries that the assessee has paid commission which has no nexus either direct or indirect with his business. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

r the AO made enquiry in earlier years or not. In this year the AO made enquiries and found that no services were rendered by the persons who were paid commission. We are convinced that there is no justification for payment of commission. Under the circumstances, we uphold the order of the learned CIT (A) in this regard and this issue of commission payment is dismissed. - Claim of agricultural income rejected and treated as taxable income - Held that:- Regarding the agricultural income, the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nt of unproved gifts - Regarding the alleged gifts, assessee has not given any details, hence the AO has made addition of ₹ 48,200. Before the learned CIT (A) the AR could not justify his claims and accordingly the CIT(A) confirmed these additions as done by the AO. As per our considered view, since there is nothing on record to support the claim of the assessee and the subordinate authorities after conducting necessary inquiry have confirmed the said addition, we accordingly see no reason .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

r, for invoking the deeming provision, the onus rests on the AO and not on the assessee. The AO himself mentioned that the liability was outstanding for more than 3 years which facts confirms that the amount does not partake the nature of income of the assessee for the A.Y under consideration. Therefore, this addition is deleted. - ITA No.663/Hyd/2015 - Dated:- 1-7-2016 - Shri B. Ramakotaiah, Accountant Member and Shri Partha Sarathi Chaudhuri, Judicial Member For The Assessee : Shri A.V. Raghur .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rring to any of the submissions made. 3. The learned Commissioner failed to appreciate that the product marketed is not sellable off the shelf and requires information about parties who require them and therefore the middleman is involved and it is not possible always to demonstrate that such middleman got the information from the ultimate buyer to demonstrate services for receiving commission, arid thereby erred in holding that the assessee has not discharged his onus of proving the requirement .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of claim of agricultural income of ₹ 30,OOO and gifts received of ₹ 48,200 without appreciating the facts. 6. The learned CIT(Appeals) erred in confirming the addition made ujs.41(1) of outstanding creditors of ₹ 22,790 in suspense account. 7. Any other ground that may be urged at the time of hearing . 2. Brief facts of the case are that the assessee, an individual, engaged in the business of trading in industrial valves, pipe fittings and pipes under the name and style of a pr .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

9. During the course of assessment proceedings, AO sought for the details of the commission paid along with nature of services rendered by each party to justify such payments. Assessee filed stereo typed confirmations from various parties. There were no details filed regarding payment made to others. Assessee did not file any details regarding the services rendered by these parties. Assessee further claimed that the payments have been made by cheques and TDS was made wherever required. AO issued .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nquiries with the customer who was introduced by the above party, who denied having any middleman came to the conclusion that no services were rendered by the above party warranting huge payment of commission. As all the other recipients of commission could not give any details as to the customers introduced by them nor services rendered by them to the assessee warranting commission payments, the AO disallowed the commission payments as being not incurred for the purpose of business. 4. The lear .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the payments are made by way of cheques and TDS has been made wherever required cannot be the ground for allowing expenditure u/s 37(1) and therefore, the AO s action on disallowance was confirmed by the first appellate authority. 5. On further appeal before us, we had asked the learned AR to produce any ledger a/c regarding the payments of entire commission wherever available or not. We had asked the AR regarding the exact rate of commission paid and what is the correlation between the sales an .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

that the assessee has paid commission which has no nexus either direct or indirect with his business. After verifying the ledger a/c, we are of the opinion that it is a way to increase expenses and to reduce the level of profit. The assessee has also not discharged before us the correlation between the business activities conducted by him and the commission paid which therefore, signifies that the payment of commission has nothing to do with the business. We also notice that in the case of Gopa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e rendered by the persons who were paid commission. We are convinced that there is no justification for payment of commission. Under the circumstances, we uphold the order of the learned CIT (A) in this regard and this issue of commission payment is dismissed. 6. Ground No.5 relates to the confirmation of addition on the ground of disallowance of claim of agricultural income of ₹ 30,000 and ₹ 48,200 on account of unproved gifts. Regarding the agricultural income, the AO sought the de .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s not given any details, hence the AO has made addition of ₹ 48,200. Before the learned CIT (A) the AR could not justify his claims and accordingly the CIT (A) confirmed these additions as done by the AO. As per our considered view, since there is nothing on record to support the claim of the assessee and the subordinate authorities after conducting necessary inquiry have confirmed the said addition, we accordingly see no reason to interfere with the order of the learned CIT (A) and theref .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version