TMI Blog2016 (12) TMI 1708X X X X Extracts X X X X X X X X Extracts X X X X ..... guide Vikas Kaul and Neeta Dadda who is a partner in the firm. Further, it is noted that on similar facts, the disallowance was deleted by ld CIT(A) for AY 200809 against which the department has not filed any appeal. Keeping in mind the nature of the business of the assessee and the explanation provided by the assessee, we see not reason to interfere with the order of ld CIT(A) who has deleted the disallowance of ₹ 1 lacs towards foreign travel expenses. Disallowance on payment to BOB and ICICI by applying the provisions of section 40(a)(ia) since the assessee has not deducted the TDS u/s 194H - Held that:- Addition deleted as relying on assessee’s own case for A.Y. 2008-09 [2012 (2) TMI 521 - ITAT JAIPUR] - ITA No.747/JP/12 with C.O. No.65/JP/12 arising out of ITA No. 747/JP/12 - - - Dated:- 17-12-2016 - R.P. TOLANI VIKRAM SINGH YADAV For the Appellant: Shri P.C. Parwal (C.A.) For the Respondent: Shri Raj Mehra (JCIT) ORDER PER SHRI VIKRAM SINGH YADAV, A.M. This is an appeal filed by the Revenue and cross objection filed by the assessee against the order of CIT(A)-I, Jaipur dated 24.07.2012 wherein the respective grounds of appeal ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dition of ₹ 25,25,182/-. The ld. CIT (A) restricted the trading addition to ₹ 6,63,915/- by applying G.P.rate of 25.50% on the declared turnover. 2.1 During the course of hearing, the ld. AR submitted that the assessee is maintaining complete books of account on day to day basis, which are subject to audit, all the transaction of purchases sales is fully verifiable from the supporting bills, vouchers documents maintained by the assessee. The AO has disputed the genuineness of the purchases made from 4 parties aggregating to ₹ 1,01,00,729/- for the reasons stated at page 4 of the order. Out of these 4 parties, summons issued to M/s Clarity Gold Pvt. Ltd. from whom purchases of ₹ 63,21,501/- was made was served and he has sent the reply through post accepting the sales made by him to the assessee. The AO has alleged the purchases from M/s Clarity Gold Pvt. Ltd. as unverifiable for the reason that in search conducted on 20.05.2009, the director of the company stated that 95% of its sales of gems unit is bogus. However, the AO himself has assessed M/s Clarity Gold in A.Y. 2006-07 by accepting the sale made by it by disallowing 25% of the certain purchases ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... addition by applying G.P. rate of 14% on the declared turnover. The ld. CIT(A)/ITAT after perusing the previous history of the assessee applied a G.P. rate of 11% as against 14% applied by the AO. On appeal, the Hon ble High Court upheld the trading addition confirmed by Hon ble ITAT by applying the G.P. rate of previous year by holding that once provisions of section 145(3) are invoked then what should be a reasonable G.P. rate is required to be seen which is a finding of fact and on the basis of appreciation of evidence, thus it is a pure finding of Act. Thus, in this decision also, the trading addition is upheld by application of G.P. rate of the previous year. Estimating the income based on past history has the seal of approval by the Hon ble High Court of Rajasthan. The ld. CIT(A) restricted the trading addition to ₹ 6,63,915/- by applying G.P. rate of 25.50% on turnover as upheld by Hon ble ITAT in A.Y. 2006-07. However, in A.Y.2006-07, the Hon ble ITAT vide order dated 18.12.2009 in ITA No.700/JP/2009 upheld the order of CIT(A) in applying G.P. rate of 25.5% only to cover the possible leakage. Otherwise also, comparison is to be made with the immediate past and not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the case are that during the year under consideration, the assessee claimed certain sales commission payment. In order to verify the genuineness of commission expenses, the AO issued summon u/s 131 to 21 parties to whom sales commission of ₹ 36,66,562/- was paid. Out of 21 parties, 17 parties responded but 4 parties made no compliance. Thereafter, the AO completed the assessment by making disallowance of ₹ 10,99,968/-, being 30% of commission of ₹ 36,66,562/- paid to all the 21 parties. The ld. CIT(A) observed that assessee s case is covered by the findings of Hon ble ITAT, Jaipur Bench in its own case for A.Y. 2006-07 and 2008-09 where the ITAT restricted the disallowance to 20% of commission paid to only those parties who did not respond to the summon. She, therefore, restricted the disallowance to ₹ 1,44,276/-, being 20% of commission of ₹ 7,21,380/- paid to 4 parties who made no compliance. 3.1 During the course of hearing, the ld AR submitted that the assessee has furnished complete details of commission payment. The voucher contains the name and address of the party to whom commission was paid alongwith the SFT no. with reference to wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material available on record. In respect of 17 parties who have complied with the summons, tax has been deducted at source and they have also reported the commission receipts in their return of income, we donot see a rationale basis which prompted the AO to disallow the commission payment. More so, where the matter is covered in favour of the assessee by earlier orders of the Coordinate Bench which has been referred to by the ld CIT(A). We accordingly upheld the deletion of additions of commission payments to these 17 parties. In respect of other 4 parties, it is noted that Shri Sudhir Jain has already complied with the summons and further assessee has filed additional evidence before the Bench. The additional evidence is accepted and the matter is set-aside to the file of the AO in respect of these 4 parties to examine the same afresh considering the additional evidence after giving proper opportunity to the assessee. 4. Regarding ground No. 3 of the revenue, the brief facts are that during the year, assessee claimed travelling expenses of ₹ 21,95,887/- including foreign travelling . The AO observed that expenses related to family members were claimed and the vouchers ..... X X X X Extracts X X X X X X X X Extracts X X X X
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