Documentary proof of expenditure claims defeats disallowance when the Revenue fails to rebut primary evidence with proper verification.

A disallowance of commission expenses is not sustainable where the assessee produces primary and corroborative evidence, including party details, PAN, confirmations, ledger accounts, TDS records and sales linkage, and the Revenue does not rebut that evidence through discrepancy-based verification or independent enquiry. The same principle applies to customs duty claims supported by ICEGATE-generated challans, e-invoices and ledger entries evidencing payment in high sea sales transactions; reliance only on summary data, without proper verification of the assessee's documents, is insufficient. The note emphasises that expenditure claims should be tested against the assessee's documentary record and not rejected on incomplete or unverified material.

---

---

Issues: (i) Whether the disallowance of commission expenses was justified when the assessee had furnished names, addresses, PAN, confirmations, ledger accounts, TDS particulars and related sales details; (ii) Whether the disallowance of customs duty was justified when the assessee produced ICEGATE-generated challans, e-invoices and ledger accounts evidencing payment through high sea sales transactions.

Issue (i): Whether the disallowance of commission expenses was justified when the assessee had furnished names, addresses, PAN, confirmations, ledger accounts, TDS particulars and related sales details.

Analysis: The commission claim was supported by party-wise confirmations, ledger accounts, nature of services, TDS deduction and remittance details, and the quantity of sales procured through the agents. The disallowance rested only on the absence of e-mail IDs, while no discrepancy was pointed out in the documents and no independent enquiry was made to rebut the assessee's evidence.

Conclusion: The disallowance of commission expenses was not justified and the deletion was sustained in favour of the assessee.

Issue (ii): Whether the disallowance of customs duty was justified when the assessee produced ICEGATE-generated challans, e-invoices and ledger accounts evidencing payment through high sea sales transactions.

Analysis: The customs duty claim was supported by challans generated from the customs portal, bearing ICEGATE reference details, date and time of payment, bank particulars, challan numbers and amounts. The assessment rested only on CBEC export-import summary data, without proper verification of the assessee's evidence or any independent enquiry, and the nature of high sea sales was also consistent with the claim.

Conclusion: The disallowance of customs duty was not justified and the deletion was sustained in favour of the assessee.

Final Conclusion: The assessee succeeded on both disputed additions, and the Revenue's challenge to the appellate relief failed.

Ratio Decidendi: A disallowance cannot be sustained when the assessee furnishes primary and corroborative evidence of expenditure and the Revenue does not rebut it by discrepancy-based verification or independent enquiry.

---