TaxTMI 
TaxTMI 
TaxTMI 
2016 (3) TMI 1149
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....evidential proof regarding services rendered by such parties. 2). On the facts and in the circumstances of the case, the Ld. Commissioner of Income-Tax (Appeals)-XIV, Ahmedabad ought to have upheld the order of the Assessing Officer. 3). It is therefore, prayed that the order of the Ld. Commissioner of IncomeTax (Appeals)-XlV, Ahmedabad may be set-a-side and that of the order of the Assessing Officer be restored. 3. Briefly stated facts as culled out from the records are that assessee is a private limited company engaged in the business of manufacturing and formulation of medicines. It filed its return of income on 17.9.2009 through electronic media declaring total income of Rs. 24,80,610/-. The case was selected for scrutiny assessment and notice u/s 143(2) of the Act was issued on 19/08/2010 and duly served upon the assessee. During the course of assessment proceedings information was called for by the Assessing Officer about the genuineness of commission expenditure of Rs. 51,56,882/- and various details and explanation were submitted by the assessee. However, it partly satisfied the Assessing Officer and so he assessed the income by making addition of Rs. 51,40,632/- disal....
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....arties in question. The AO has given proper opportunity to the appellant and asked for the confirmations from the parties to whom commission has been paid. The show cause for commission paid account of R$. 49,32,229/- has been given. The affidavit dated 29706/2012 filed by Shri Dhaval Shah (AR attended assessment proceedings) saying that no proper opportunity was given and only 7 days were given to file details including certain details to be called from outstation parties. The details which the appellant intended to file for consideration have been filed during the course of appeiiate proceedings and same were sent to the AO for his comments. . Further, in the assessment order, the AO has relied on following case laws: (i) Assam Pesticides Vs. CIT [227 ITR 846], Gauhati HC (ii) CIT Vs. Premier Breweries Ltd. [279 ITR 51 (Ker) (iii) Bhargav Refrigeration Industries Pvt. Ltd. Vs. ITO [28 TTJ 587], ITAT, Delhi Bench (iv) ITO Vs. Maddi Laxmaiah & Co. (P) Ltd. [31 ITJ 71 (Hyd] The AO has emphasized that the mere payment by itself does not qualify for deduction in computing the income unless, the necessity for such payment was also shown as for the purpose of business. No re....
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....ommission TDS amount Net commission 1. Allianz Pharma Care Plot No.201, Bapuji Nagar, Bhubaneshwar771003 AAMFA 3767G 99110 10209 88901 2 Amegh Pharma P. B-606, Crystal Plaza, New Link Road, AAGCA 4614H 642000 66125 575874 Ltd. Andheri(W), Mumbai400053 3. Gokul Traders 9, 1st floor, National Chambers, Nr. City Gold Multiplex, Ashram Road, Ahmedabad-380009 AJBPS 1381E 217462 22464 194998 4 Jigna S Shah 121,Manekbaug Society, Nehru Nagar, Ahmedabad ANKPS 7883E 399932 41192 358740 5 Sanidh B. Shah 6, 1" Floor, National Chambers, Nr. City Gold Multiplex, Ashram Road, Ahmedabad 380009 AJBPS 2294N 195000 20085 174915 6 Jagumani Dash Plot No. 90, Lane No. 3, Jagannath Vihar, Baramunda, Bhubaneshwar -751003 AIEPD 5322Q 262047 26991 235056 7 Spectrum Enterprise S. No. 1A, 4, Ganesh Park (Anand Park), Chinchwadgaon, Pune411 033 ACLPI 1316K 214140 22056 192084 8 Venkata Yamuna Impex Plot No. 80, Kacyam Gardner, B/h. Sainikpuri, Secundrabad -500 894 AAFFV 0754M 1250000 128750 1121250 9 Venus International B-603, Corolla Jewel, Military Roa....
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....parties, full particulars with PAN and copies of liaison agreement with various parties. It is a general accepted fact that in pharma business commission expenses are incurred for boosting up sales and it is a usual practice. We further find that assessee gross turnover is also increased to 15.17 crores from Rs. 10.66 crores in the immediate preceding financial year and profit has also doubled reaching Rs. 20.74 lacks in the year under appeal from Rs. 11.06 lacs. We therefore are of the view that looking to the nature of business of assessee various details and documentary evidences produced before the lower authorities, increase in sales along with increase in profits and allowability of commission expenditure in previous years, we are of the view that ld. CIT(A) has rightly deleted the impugned addition made by the Assessing Officer disallowing commission of Rs. 5140632/- and we find that the same has been incurred wholly and exclusively for the purpose of business and assessee has produced sufficient proof regarding services rendered by these parties. We, therefore, find no reason to interfere with the order of ld. CIT(A) and accordingly dismiss the ground of Revenue. 10. Other....
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....he rival contentions and perusing the material on record, we would like to mention that we have already dealt with similar ground for Asst. Year 2009-10 in ITA No.1162/Ahd/2013 above and have dismissed the ground of Revenue vide para no.8 & 9 above holding that the commission expenditure claimed by the assessee was genuine. The issue being similar, we apply the ratio of our above decision to this ground also and accordingly we uphold the order of ld. CIT(A). This ground of revenue is dismissed. 16. Ground no.2 of Revenue's appeal relates to deletion of disallowance of Rs. 2,76,912/- on account of prior period expenses. 17. The ld. DR supported the order of Assessing Officer 18. On the other hand ld. AR relied on the order of CIT(A) and submitted that the expenses of Rs. 2,76,912/- were reported in the audit reports itself. The amount in question relates to expenses incurred by the Rudrapur Branch of assessee. The assessee was having no information about the expenditure in the prior period and the invoices were received and expenditure crystallized during Asst. Year 2010-11 so the same were rightly claimed. 19. We have heard the rival contentions and perused the material on reco....
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....see is having various branches and details of expenses are to be sent to the head office then there remains the possibility that some invoices which pertain to prior period have been received by the head office of the assessee during the year under appeal. As the genuineness of the expenditure has not been doubted we find no reason to interfere with the order of ld. CIT(A) who has rightly deleted the addition made on account of disallowance of prior period expenses by Assessing Officer. Accordingly, we dismiss this ground of Revenue. 21. Ground no.3 relates to disallowance of Rs. 13,601/- made on account of late payment of employees contribution. 22. We have heard the rival contentions and perused the material on record. We find that ld. CIT(A) has observed as under while dealing with this ground :- 4.3 Decision: ! have carefully perused the assessment order and the submission given by the appellant. The appellant has relied on various case laws. No case law from jurisdictional ITAT or High Court was produced before the undersigned during the course of appellate proceedings. The proposition by appellant is that if the amount is paid so as to enable it to get deduction u/s 43B....