2013 (7) TMI 33

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....following effective grounds. "1. The ld.CIT(A) has erred in law and on facts in deleting the addition of Rs.2,57,000/- made by the AO regarding payment of incentive to five staff members. 2. The ld.CIT(A) has erred in law and on facts in deleting the addition of Rs.24,52,114/- made by the AO under section 40(a)(ia) on account of Jeep's transportation expenses." 3. Briefly stated facts are that the case of the assessee was selected for scrutiny assessment, and in the assessment so framed under Section 143(3) of the Income Tax Act, 1961 (hereinafter refer to as "the Act") , the AO made disallowance of expenditure in respect of payment of incentive and commission, and also made disallowance under section 40(a)(ia) of the Act qua jeep ....

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....les and incentive commission have not been narrated by the assessee. Further, it is observed that scrutiny of the bank account of the person revealed that the respective cheques issued by the assessee were credited in their respective account, and after clearance of these cheques immediately on the next date, the cash withdrawn from the said bank, and the purpose of the cash was not made available. However, the learned CIT(A) reduced the quantum of disallowance on the basis that the AO was not justified in disallowing the entire sum of Rs.7,26,000/- only on the presumption that no incentive was paid to staff members when sample sheets produced before him. We have given our thoughtful consideration to the facts of the present case. The asses....

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....lace of "MML" to the place of the assessee. He submitted that the AO failed to appreciate the fact that Rupees four thousand per vehicle was paid to the driver as reimbursement of the expenses inclusive of transit insurance, RTO Trade plate charges and other expenses. He submitted that there was no contract between "NAW" and the assessee. 8. We have heard rival submissions and perused the material on record. The AO in this case has allowed the expenditure of the assessee in respect of the jeep transportation on the ground that the assessee had failed to deduct tax on the payment made to the drivers. The AO considered the payment made to drivers, as payment made to "NAW", who being the authorised transporter of "MML". Under these facts an....

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....t, the appeal of the Revenue is dismissed. 10. Now we take up the CO of the assessee. The assessee's has raised the following grounds in the CO: "1. The ld.CIT(A) has erred in law and or on facts in upholding the addition out of incentive exps. to the extent of Rs.2,57,000/- 2. That in the facts and circumstances of the case, the ld.CIT(A) ought not to have confirmed disallowance out of incentive exps. To the extent of Rs.2,57,000/-" 11. In ITA No.3448/Ahd/2010 of the Revenue (supra), we have decided the identical issues against the Revenue, confirming the findings of the CIT(A). The contention of ld. Counsel for the assessee that the amount of incentive paid is duly reflected in the books of accounts, merely on the ground that ....