2022 (11) TMI 1019 - AT - Income Tax

Assessee's appeal dismissed for failure to provide evidence & cooperate. Rs. 16,79,620 commission expenses upheld.

The Tribunal dismissed the appeal filed by the assessee against the disallowance of commission expenses due to failure to provide necessary evidence and ... Disallowance of commission paid to six parties - assessee was asked to produce the parties, but, despite various opportunities, the assessee failed to produce the parties nor provided their new addresses - HELD THAT:- Even before the Tribunal, the assessee company did not appear despite sending notices through Speed Post which have been returned by the postal authorities with the remarks “No such person at the address”. We are of the view that when the appeal is filed before the Tribunal by the assessee company itself against the orders of the lower authorities, it is expected that the assessee company may put forth documentary evidences in support of its contentions to decide the appeal as it is the duty of the assessee company to lead evidence in support of its claim and for the adjudicating authority to decide upon the sustainability of the claim on the basis of the evidence led by the parties before it. However, the assessee company neither appeared before the Tribunal nor placed any material to controvert the findings of lower authorities. In this view of the matter and in absence of any contrary material brought on record to rebut the findings of lower authorities, we find no reason to interfere with the order of CIT(A) and thus we dismiss the grounds of the assessee. Issues:1. Disallowance of commission expenses and confirmation of the addition by the AO and CIT(A).2. Appeal filed by the assessee against the order of the Ld. CIT(A) regarding the A.Y. 2008-2009.Detailed Analysis:1. The appeal was filed by the assessee against the order of the Ld. CIT(A) concerning the A.Y. 2008-2009. The assessment initially determined the income of the assessee at Rs. 66,93,300/-. The Ld. CIT(A) confirmed the additions made by the Assessing Officer (AO) and granted partial relief to the assessee. Subsequently, the AO revised the income to Rs. 62,79,840/- under section 250/143(3) of the I.T. Act, 1961. The Tribunal referred the issue of commission paid for denovo consideration to the AO, who noted that the assessee failed to produce parties to whom the commission was paid or furnish their latest addresses. The AO determined the total income of the assessee at Rs. 62,79,840/- in the assessment order passed under section 254/250/143(3) of the I.T. Act, 1961 dated 07.03.2016.2. The Ld. CIT(A) upheld the order of the AO, stating that the appellant failed to provide new details or evidence to justify the commission payments. The appellant did not produce parties to whom the commission was paid or provide their latest addresses. The Ld. CIT(A) observed that the appellant did not discharge its duty to cooperate with the proceedings. The appellant's contention that the AO did not make any inquiry under section 131 of the Act was dismissed. The Ld. CIT(A) concluded that the appellant could not justify the payment of commission to six parties amounting to Rs. 16,79,620/-, and the addition made in this regard was sustained.3. During the appeal hearing, the assessee did not appear, and the appeal was deemed ex-parte. The Ld. CIT(A)'s order was strongly supported by the Ld. D.R., who prayed for confirmation. The Tribunal noted that the Ld. CIT(A) upheld the disallowance of commission paid to six parties. Despite sending notices, the assessee did not appear before the Tribunal or provide any material to challenge the findings of the lower authorities. The Tribunal found no reason to interfere with the order of the CIT(A) and dismissed the grounds of the assessee.In conclusion, the appeal filed by the assessee against the order of the Ld. CIT(A) regarding the disallowance of commission expenses was dismissed by the Tribunal due to the assessee's failure to provide necessary evidence and cooperate with the proceedings. The Tribunal upheld the decision of the lower authorities and confirmed the addition of Rs. 16,79,620/- towards commission expenses.