ITAT decision on commission & travel expenses appeal. Deemed dividend addition deleted. Pre EMI interest disallowed.

The ITAT dismissed the appeal on commission expenses due to lack of details provided by the assessee. The disallowance of travelling and vehicle expenses was reduced to Rs. 72,000 from Rs. 2,36,986 by the ITAT based on available evidence. The addition of deemed dividend under section 2(22)(e) was deleted by the ITAT due to adjustment entries in the ledger account, partially allowing the appeals. In a separate appeal for another assessment year, the ITAT upheld disallowance of Pre EMI interest and restricted overall expenses disallowance to 30%, while deleting the addition under section 2(22)(e) for one company but sustaining it for another due to lack of evidence.

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Issues involved:
1. Disallowance of Commission Expenses
2. Disallowance of Travelling and Vehicle Expenses
3. Addition under section 2(22)(e) of the Act

Issue 1: Disallowance of Commission Expenses:
The assessing officer disallowed commission expenses of Rs. 59,600 as the assessee failed to provide supporting details like list of commission agents, PAN, TDS deduction, and nature of services rendered. The CIT(A) upheld the disallowance. The ITAT found that the assessee did not furnish necessary details even during appellate proceedings. As a result, the ITAT dismissed the appeal, stating no reason to interfere with the CIT(A)'s decision.

Issue 2: Disallowance of Travelling and Vehicle Expenses:
The assessing officer disallowed Rs. 2,36,986 claimed as travelling and vehicle expenses due to lack of evidence. The CIT(A) upheld the disallowance. During the appeal, the assessee presented ledger accounts audited under section 44AB, but failed to provide relevant supporting evidence. Considering the car hiring income and business income, the ITAT restricted the disallowance to Rs. 72,000, allowing this ground of appeal.

Issue 3: Addition under section 2(22)(e) of the Act:
The assessing officer added Rs. 56,89,201 as deemed dividend under section 2(22)(e) due to loans received from a company where the assessee held shares. The CIT(A) restricted the addition to Rs. 39,527. The ITAT noted numerous entries in the ledger account as adjustment entries, indicating a running account nature. Consequently, the ITAT deleted the addition, allowing this ground of appeal.

In a separate appeal for the assessment year 2012-13, similar issues were raised. The ITAT dismissed the appeal regarding commission expenses due to lack of details. The disallowance of Pre EMI interest was upheld, and the disallowance of expenses was restricted to 30% for want of proper bills and vouchers. Regarding addition under section 2(22)(e) for funds received from specific companies, the ITAT deleted the disallowance for one company due to adjustment entries but sustained it for another company due to insufficient evidence. Overall, both appeals were partly allowed by the ITAT.

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