2016 (5) TMI 117

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....nal was justified in upholding the order of the CIT(A) and thereby not sustaining the disallowance made by the Assessing Officer of the payment of Rs. 1,13,24,831/claimed by the assessee, without appreciating that the assessee had failed to substantiate the allowability of the said expenditure in terms of Section 37(1) of the Act ? (ii) Without prejudice to the Revenue's stand that the impugned deduction claimed by the assessee on account of payment to Mr. J.V. Smith is not allowable, whether on the facts and circumstances of the case and in law, the Tribunal was justified in upholding the order of the CIT(A) and thereby not sustaining the finding of the Assessing Officer that the impugned payment constitutes fees for managerial and ....

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....g aggrieved, the respondent assessee carried the issue in appeal to the Commissioner of Income Tax (Appeals). On examination of all facts it records that commission is being paid to Mr. John Smith since 2002 and it is for the first time in the subject assessment year that it is sought to be disallowed. Besides, it records that the commission at 6.5% was fixed in the year 2002 and was not to be so for all time. This is evident from the Agreement itself which clearly stipulates that it is presently fixed at 6.5% and is subject to variation by agreement of the parties. The fact that Mr. John Smith describes himself as a marketing consultant cannot be the basis of deciding the nature of commission paid to him. In the course of appellate proceed....