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ITAT held that commission paid for procuring bonds in a one-time...
Business expenditure disallowance failed where commission, related-party salary and promotion payments were supported by records and inquiry was inadequate.
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ITAT held that commission paid for procuring bonds in a one-time trading transaction was allowable as business expenditure where payments were made through banking channels with TDS, confirmations, PAN and bank details, and the underlying bond deal was not disputed; suspicion based on non-response of some parties or missing unspecified KYC material was insufficient, so the ad hoc disallowance was deleted. It also deleted disallowance of salary paid to a related party because no specific inquiry was made into the employee's qualifications, experience or work profile, and there was no finding of excessiveness. Business promotion expenditure paid to two HUFs was similarly allowed because invoices, bank payment and identity documents were on record, while the claim relating to Planwell Industries Corporation was not pressed.
ITAT held that commission paid for procuring bonds in a one-time trading transaction was allowable as business expenditure where payments were made through banking channels with TDS, confirmations, PAN and bank details, and the underlying bond deal was not disputed; suspicion based on non-response of some parties or missing unspecified KYC material was insufficient, so the ad hoc disallowance was deleted. It also deleted disallowance of salary paid to a related party because no specific inquiry was made into the employee's qualifications, experience or work profile, and there was no finding of excessiveness. Business promotion expenditure paid to two HUFs was similarly allowed because invoices, bank payment and identity documents were on record, while the claim relating to Planwell Industries Corporation was not pressed.
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