TMI Blog2017 (1) TMI 1783X X X X Extracts X X X X X X X X Extracts X X X X ..... or getting the orders the assessee has to make installation of submersible pumps at the various sites identified by Public Health Department and liasoning charges have been paid by the commission account. Thus, the assessee has made payment for the services rendered. The assessee has explained the nature of services rendered. Therefore, we are of the view that the learned CIT(A) is justified in allowing the claim. The same kind of commission was allowed in four earlier assessment years 2005-06 to 2008-09 and it was allowed in scrutiny assessments for the assessment years 2005-06 and 2006-07. Therefore, rule of consistency is followed by the learned CIT(A). We are of the view that the learned CIT(A) is justified. Moreover, the assessee has given sufficient evidence to prove the same. Therefore, we do not find any discrepancy in the order of the learned CIT(A) - Case followed PURE PHARMA PVT. LTD. [ 2004 (3) TMI 31 - MADHYA PRADESH HIGH COURT] - Decided in favour of assessee. - I.T.A. No. 49/Ind/2013 And I.T.A. No. 803/Ind/2014 - - - Dated:- 5-1-2017 - Shri D.T. Garasia, Judicial Member And Shri O.P. Meena, Accountant Member For the Revenue : Shri Mohd. Javed. For t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... suing various Govt. agencies, the commission agent works for issuing of indents from such Govt. Offices, quoting requirment of pumps. Such indents are then submitted by commission agents to Madhya Pradesh Laghu Udyog Nigam Ltd. (MPLUN). Thereafter commission agents pursue MPLUN to get the tendering process done on such indent and there liasoning and persuasion is required for getting the purchase order for such pumps being placed in name of appellant. After getting purchase orders in favour of appellant, commission agents are required to ensuren supply of pumps in time, getting them properly installed and get a favourable inspection report from resective government deptt. so that the payment is released by that deptt in favour of the appellant. Hence the role of MPLUN in Government contract is limited to job of calling tenders for every purchase order and finalisation of tender process by placing order in name of one of the parties. The commission agents are involved in pre-tender and post tender work. Considering the description given MPLUN and Commission agents are working towards same goal of placing Government work orders, but they have separate and independent areas of wor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from submission of appellant dated 23.11.2012 that appellant has claimed such commission expenses in at least 4 earlier years i.e. in A.Y. 2005-06 to 2008-09 and commission expenses have been allowed to appellant in all 4 years, even when scrutiny assessments were conducted in A.Y.2005-06 and A.Y. 2006-07. Following the rule of consistency, such commission expenses has to be allowed to appellant in A.Y. 2009-10 also. For such decision reliance is placed on the caase of Mandeep Singh (2010) 328 ITR 169 (P H). Appellant has filed copy of acknowledgement for filing return and computation of income for A.Y. 2005-06 of all its commission agents. It is seen from the same that entire commission receipt is reflected by them in their return of income and after claiming only minor expenses from it, substantial part is shown in their net income. For example a commission of ₹ 2,05,912/- was paid to Shri Mukesh Ratanlal Khaniwal HUF, who has reflected this receipt in return and after claiming expenses of ₹ 30912 has offered net income on this transaction at ₹ 1,75,000/- in his return. Similar facts are found in returns of other commission agents. Considering all th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2008-09 commission has been allowed, therefore, following the rule of consistency, the claim has been allowed. Moreover, he relied upon the decision of the Hon'ble M.P. High Court in the case of CIT vs Pure Pharma; 144 taxmann.364 (MP). 7. We have considered the submissions of both the sides. Looking to the facts and circumstances of the case, we find that in this case the Assessing Officer has disallowed the commission expenses including commission paid to MPLUN of ₹ 14,15,925/-, a Corporation of M.P. State Government enjoying the sole right to convert the intend of purchases. The assessee has shown the commission ranging from 7% to 9% above the commission to MPLUN. The expenditure is supported by the bills raised by the payee. The assessee has given PAN mentioning the bill. The commission has been paid for collecting the requirement from the Government offices located at Indore, Khargone, Mandla, Balaghat, Chhindwara and Dewas. The assessee is engaged in manufacture of sub-mersible pumps and during the year the assessee has supplied the product of the assessee to Public Health Engineering Department, Govt. of M.P. and many other Government departments. Therefore, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present appellant-Revenue. 5. Therefore, considering the totality of the facts and respectfully following the decision of Jurisdictional High Court, we are not inclined to interfere with the findings of the ld. CIT(A). Accordingly, the appeal of the Revenue in respect of above three grounds is dismissed. This view is also supported by the decision of the Jurisdictional High Court as relied upon by the ld. Authorized Representative of the assessee, the Hon'ble High Court in the case of CIT vs. Pure Pharma, (2005) 144 Taxman 364 (MP) in para 3 4 held as under :- 3, A few facts material for deciding the said appeal, in short, may be mentioned as under : The Respondent/assessee company is engaged in manufacturing and sale of pharmaceutical formulations. During the previous financial year, the assessee had paid total commission of ₹ 13,35,336/-. Out of this, a sum of ₹ 10,24,290/- was paid as commission on sales made to the Government and its agencies and a sum of ₹ 3,11,046/- was paid as commission to non-Government purchases. Since, a doubt was raised with regard to the payments made to various parties as commission, enquiry was held. I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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