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TMI Blog2022 (11) TMI 660X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee has challenged the order of Ld. CIT(A) in upholding the addition on account of Sales Commission of Rs. 3,54,311/- and 3,39,083/- in respective assessment year by the Assessing Officer. Since, there is sole issue of commission payment on identical facts, both the appeals were heard together and disposed off by this common order for brevity. 2. The assessee has raised the following grounds of appeal in ITA No. 204/Asr/2019: "1. The order passed by the Learned Commissioner of Income Tax (Appeals) is opposed to law and facts of the case. 2. The Learned Commissioner of Income Tax (Appeals) has erred in upholding the addition on account of Sales Commission amounting to Rs. 3,54,311/- paid to employees of the company viz. Estate O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Sales Commission has been paid to the employees of the company to incentivize them and is part and parcel of their Salary package. 4. The Learned Commissioner of Income Tax (Appeals) has failed to appreciate that all employees contribute to the progress of the company and are remunerated based on the sales of the company. 5. Any other ground which may be allowed to be brought at the time of hearing of appeal. It is prayed, that the addition of Rs. 3,39,083/- may please be deleted and appeal allowed." 4. At the outset, the Ld. counsel for the assessee has submitted that the appellant has paid Sales Commission to the employees of the assessee company to incentivize them and is part and parcel of their salary package as per ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... para 4 of the Assessment Order). The learned CIT (Appeals) has relied upon the order of the Assessing Officer who has ruled that sales incentive given to employees like Estate Officer, Store Keeper, Cashier, Asstt. Store Keeper, G.D. Clerks, Accountant, Computer Operator, Coolie and Peon are not directly related to sales department. The findings of the authorities below are not tenable. The business of the Appellant is sales/purchase of liquor and all these employees are directly or indirectly related to sales of the company. The Secretary is the overall in charge of sales operation whereas persons like Store Keeper, Cashiers, Asstt. Store Keeper, G.D. Clerk, Accountant, Computer Operator, Coolie and Peon are directly related to the cond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nded that what is claimed by the assessee relates to incentives paid to its employees and no way related to the sales commission. The learned CIT appeal was therefore justified in confirming the bogus expenditure claimed by the appellant assessee under the head sales commission. He prayed that order of the CIT appeal may be sustained. 6. We have heard the learned counsel and additional CIT DR, perused the material on record and case law cited at the bar. Admittedly, the appellant assessee has paid sales incentives to its employees as part of the salary package where he was required to deduct TDS. Since the assessee has not deducted the TDS on such payments of incentives, therefore he has claimed, these expenses under the head sales commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal has dealt with the issue and genuineness and payments of 15% interest to the relatives u/s. 40A(2) whereas in the present case, the issue is claim of payment of sales commission against sales incentives paid as part of salary package to the employees of the assessee company without deducting TDS. 8. Similarly, the judgment given by Hon'ble Apex Court in the case of "S.A. Builders Lt vs. CIT", (2006) 206 CTR (SC) 631 : (2007) 288 ITR 1 (SC), on the issue of commercial expediency is of no help to the appellant assessee because, the issue involved is claim of sales commission without TDS deduction in violation of provisions of the section 194H of the Income Tax Act, 1961. 9. Considering factual matrix and legal intricacies, we find ..... X X X X Extracts X X X X X X X X Extracts X X X X
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