TMI Blog2013 (6) TMI 822X X X X Extracts X X X X X X X X Extracts X X X X ..... 3) of the Act on 27.11.2009 by the Asst.CIT, Circle-2 Surat. The firm is engaged in the business of manufacturing and trading of grey cloth. During the year, the firm had shown GP of ₹ 38,00,518/- @ 9.22% on total turnover of ₹ 4,11,91,980/- as against the gross profit of ₹ 8,53,947/- @ 7.65% on total turnover of ₹ 1,11,59,234/- shown in the immediately preceding year, i.e. Asst.Year 2006-07. The assessee had debited an amount of ₹ 20,02,.789/- in the Profit Loss Account under the head brokerage commission . The AO has reproduced the details of commission and brokerage in the assessment order at page Nos.2 3. Commission expenses of ₹ 20,02,789/- on which TDS of ₹ 1,12,104/- was deducted by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee had sold 70% of grey cloth to Bombay party, the commission agent from Bombay had undertaken the work not only the collection from the customers but also full responsibility right from discharge of goods to payment of bill on time, i.e. these agents are like del credere . They are responsible for collection of the sales proceeds. The assessee realized the payment within 30 days from the date of the sale of good on which he has saved the interest of fund. The assessee had deducted the TDS from commission on which names of the deductee, addresses of all the persons whom the commissions have been paid could be verified and necessary enquiry could be made as to the genuineness of the services rendered by them. 4. Now the Revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d as under:- 4 . The fact that the assessee did pay commission to its foreign agent has been acknowledged by the AO as is apparent from his decision in restricting the deduction to 2.88% of the turnover. Once the commission is accepted to have been paid, there is no logic in disallowing such expenditure by holding that it was excessive. It is for the assessee to determine the way in which it has to carry on its business. The assessee has to decide the percentage of commission which is to be allowed by him considering all the attending circumstances and the business exigencies. In our considered opinion, the ld.CIT(A) was justified in deleting this addition. 7.1. Further, the Hon ble Gujarat High Court in the case of Voltamp Limite ..... X X X X Extracts X X X X X X X X Extracts X X X X
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