TaxTMI 
TaxTMI 
2017 (1) TMI 510
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.... allowable @ 3%. The Revenue's grievance on the other hand is that the CIT(A) ought not to have deleted the above commission payments disallowance as made by the Assessing Officer. We come to relevant facts first. 3. The assessee/a company is engaged in pharmaceutical business. It made commission payments to 13 parties totaling to Rs. 67,77,001/-. The Assessing Officer disallowed the same in assessment order after holding that although the assessee has filed all the relevant details alongwith confirmations, PAN particulars, TDS deductions, commission/liasoning agreements of the above payees who had also filed their responses in furtherance to scrutiny notices, there was no proof of the payees services rendered to the assessee. He further observed that mere payment and furnishing of the above particulars would not render the impugned commission payments as allowable in absence of actual proof of the marketing /liasoning services rendered. 4. The assessee preferred appeal. The CIT(A) partly accepts its contentions as follows: "2.3 Decision: I have carefully perused the assessment order and the submissions given by the appellant. The AO has given proper opportunity to the appel....
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....submitted and not reproducing for sake of brevity (PP 13 to 33 of PB). A copy of ledger account giving details about TDS is also filed. The information submitted by appellant is reproduced in tabular form below: In reference to Distribution Expenditure of Rs. 3,81,930/- paid to Shri Anupam Parmar, it is found that the assessee has submitted copy of agreement entered into with him. The A.O. came to the conclusion that no service has been rendered without examining Shri Parmar and also without examining aforesaid commission agents. It is further found that the assessee has made payment according to the agreement entered into and in reference to all the above nine parties TDS has been deducted. Confirmation received from all the parties which are also on record alongwith TDS certificate in Form No.16A. It is further found that the assessee has given reply dated 22.12.2012 placed on Paper Book Page 13 to 15, wherein in Para 9, it inter alia requested the A.O to kindly examine aforesaid all nine parties in case addition was contemplated. As per records, the AO has not examined any of the nine parties and went on to make addition as per precedents of the case. The appellant has be;en....
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...., confirmation of accounts, Certificate in Form No.16A issued to the parties, copy of the agreement with parties as under: Sr. Name of the party Address P.A. No. Amount of commission 1 Anupam Parmar B/60, Manokamna Tenament Nr. Kharawala Factory Isanpur, Ahmedabad APHPP5938G 26,000/- 2 Gokul Traders National Chambers Nr. City Gold Ashram Road Ahmedabad-3 80009 ABJPS1381E 1,86,167/- 3 Venus International B-603, Corolla Jewel Military Road, Marol, Andheri, Mumbai AAYPM2525E 1,12,452/- 4 Ketan Nareshchandra Thakkar E-4, Kundan Flat Vibhag 2, Vasna Ahmedabad-7 AAAHPT3877B 1,31,444/- 5 Purvi Associates 817DevpathBldg B/H Lal Bunglow Ellisbridge, C.G. Road Ahmedabad AELPS4823P 1,66,025/- 6 Sutaria Services 24 Asia House Nr.Swastik Cross Road, Navrangpura Ahmedabad ACIPS7791Q 1,56,184/- 7 Ace Enteprirse A/402, Mangalya Tower Nr.Anjali Cross Road Bhatta, Paldi, Ahmedabad ACMPT9447J 1,56,185/- 8 Vidur Corporation 304, Ruturaj Chamber Swastik Cross Road Navrangpura Ahmedabad ALEPT5316R 2,03,704/- 9 Rajendra B.Lattakar Pune Maharashtra AAKHR6322L 2,22,400/- 10 Shreejina Ketan & Co. F/61 Satellite Center Ahmedabad- 15 AAEPT5628H 1,90,832/-....
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....the appellant company apart from commission. Generally, in this trade 2% to 3% commission is normal, whereas it is seen that the appellant has paid exorbitantly high commission to different persons particularly to its director Shri Vijay J Shah without any valid reason . Accordingly following the appellate orders passed by ld.CIT(A) for A.Y. 2009-10 & 2010-11 in the case of appellant the addition made against commission payment of Rs. 67,77,001/- is deleted with following remark. However in view of observation made by me, wrt to rate of commission paid by appellant company, the A.O. is directed to allow the claim of appellant after verifying the rate of commission payment and restricting the rate of commission payment @ 3%. Subject to this condition, this ground of appeal is partly allowed." 5. Heard both sides reiterating their respective stands in support of and against the impugned disallowance. Learned Authorized Representative first of all invites our attention to the fact that the very issue had arisen in the preceding two assessment orders as well wherein a co-ordinate bench of this tribunal in Revenue's appeal ITA Nos. 1162 & 2145/Ahd/2013 decided on 02.03.2013 accepted....