2016 (7) TMI 537

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....eal of the assessee is with regard to confirmation of disallowance of commission payment made by the assessee to its agents. 2. The appeal of the assessee is found to have been filed late by 132 days in filing the appeal. The assessee filed petition for condonation of delay in filing the appeal in support of affidavit along with medical certificate. By referring to the medical certificate and affidavit, the ld. Counsel for the assessee has submitted that the Managing Director of the assessee company was under medical treatment for Paralysis during January, 2015 and after getting recovered from the illness, the appeal was filed on 31.07.2015. Therefore, he pleaded that there is no willful delay in filing the appeal and prayed for condonat....

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....t was claimed by the assessee as expenditure in the normal course of its business and qualified as business expenditure. The assessee company has paid commission to the parties who had introduced new clients to the commodity exchange. On account of this, the company has earned higher revenue of contractual receipts as it was based on the volume of business done by the clients in the commodity exchange. The commission was also paid to parties for increasing the sales turnover in bullion and jewellery. The assessee also submits that they have paid commission to parties for both its own sale of bullion and jewellery of which it had a turnover of Rs..155.43 crores and also towards its MCX business for which the assessee has earned Rs..31,49,065....

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..... R.S. Gold and the appellant company. The Proprietrix of M/s. R.S. Gold was Mrs. A. Swathi, who held the licence for multi commodity exchange for trading in MCX. The appellant has agreed to undertake the administration of the operations under the MCX licence and look after the day to day operations along with the development of business by enrolling new clients/sub-clients. As per this agreement, the appellant shall be paid all the monthly gross receipts from MCX, for the payment of expenses relating to MCX. However, the appellant could not furnish the details of receipt of monthly gross receipts from MCX. As per the Memorandum of Understanding, at Point No.9, it is mentioned that the appellant shall be given 50% of the receipts after adju....

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....n the form of KYC mentioning the name of the introducer. On verification of the details nowhere it could be found that any client was introduced to do business with the appellant company. The appellant company also could not furnish any details regarding this. 10. The appellant has also paid a commission of Rs. 8 lakhs to Smt. Praveena who is the wife of Shri R. Chandrasekar, the Director of the company. The basis of arriving at the commission of Rs. 8 lakhs could not be proved by the appellant company. No services were rendered by Smt. Praveena regarding MCX trading. In the absence of any evidence regarding the nature of services rendered by the above mentioned persons, the commission payments made to them are disallowed. The disallowan....