TaxTMI 
TaxTMI 
2012 (9) TMI 795
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....ssee is a partnership firm and is having income from commission/service charges from direct marketing/selling agency of ICICI Bank Ltd. on car loan sanctioned through it. The total commission/service charges received during the year was at Rs.6786,740/- against which the net profit was shown at Rs.5,98,932/-During the course of assessment proceedings, the assessee produced list of parties to whom commission of Rs.35,65,096/- was paid by the assessee. The confirmations of certain parties were also submitted before the Assessing Officer. The Assessing Officer made certain enquiry from ICICI Bank and found that the assessee has issued bearer cheques in the name of parties receiving commission but the same has been encashed by the assessee itse....
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....our honour has made an addition of Rs.1,73,549/- during the course of completing the assessment of the assessee firm for A.Y. 2005-2006 on the basis of the declaration made by the assessee firm vide submissions dated 31.12.2007 in respect of the parties/sub brokers to whom commission has been paid, but are not available or traceable and in respect of whom no confirmations have been submitted during the course of assessment. In this connection we would like to reiterate that the aforesaid parties to whom the commission has been paid are genuine and in existence/present, but the confirmations or complete addresses where of could not be furnished during the course of hearing. This is more particularly because all of them were one timers and no....
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....nd the declaration voluntarily given by the assessee for agreed addition of disallowance of commission paid was made by the assessee purely to buy peace and not otherwise." The Assessing Officer rejected the said submissions of the assessee and relying on the findings given in the assessment order, levied a penalty of Rs.63,506/- on the commission disallowed at Rs.1,73,549/-. 4. In the first appeal, the assessee made detailed submission, which has been incorporated at page 2 and 3 of the impugned order. The sum and substance of these arguments were that the assessee had paid commissions to so many persons and confirmation and addresses in most of the cases were filed and the same has been accepted. All the payments have been made thro....
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....3,549/- as income. He strongly relied upon the findings of the Assessing Officer as well as CIT(A). 6. We have carefully considered the rival submissions and perused the findings given by the Assessing Officer as well as CIT(A). From the perusal of the penalty order, it is seen that the Assessing Officer has solely relied upon the findings given in the assessment order, without giving a specific finding as to why the explanation offered by the assessee is false. Even though the addition has become final in the assessment proceedings, however, such a finding in the assessment order is not a final word in the penalty proceedings upon the pleas which can be taken up at the penalty stage and whatsoever relevant and good the findings are give....