TaxTMI 
TaxTMI 
2017 (9) TMI 429
X X X X Extracts X X X X
X X X X Extracts X X X X
....eing disposed of by this common order for the sake of convenience, by dealing with ITA No. 5859/Del/2015 (AY 2011-12). 2. The grounds raised in ITA No. 5859/Del/2015 (AY 2011-12) read as under:- "1. Whether the CIT(A) has erred in deleting the addition of Rs. 32,90,089/- on account of advance commission by treating it was an advance commission instead of commission of relevant year without considering the fact that the warranty of the equipment is binding on the Original Equipment Manufacturer (OEM) and not on commission agent. In case of any defects observed, OEM is the authority liable to provide such services. 2. The appellant craves leave to add, alter or amend any / all the grounds of appeal before or during the course of hearing....
X X X X Extracts X X X X
X X X X Extracts X X X X
....is commission disallowed, Rs. 15,00,000/- was on account of commission paid to various parties and Rs. 3,55,000/- (50% of commission) paid to spouse of the assessee. On perusal of record for AY 2011-12, it was found that the assessee has again shown the advance commission received of Rs. 32,90,089/- under the head sundry creditors for advance. The difference of this advance for AY 2011-12 and AY 2010-11 comes to Rs. 2,86,143/- (Rs. 3290089-3003946). Secondly, the assessee has again shown commission paid of Rs. 3,00,000/- under the head of direct expenses. Therefore, the AO formed an opinion that income chargeable to tax to the extent of Rs. 5,86,143/- (Rs. 2,86,143 + 3,00,000/-) has escaped assessment. Accordingly, after recording reasons n....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n this issue stating therein as follows- "That the assessee had preferred an appeal against the addition of Rs. 30,03,946/- made by the AO for AY 2010-11 on account of advance commission. The CIT(A) deleted the addition on this issue. Further, the assessee has submitted that the gross receipt of the year under reference includes of Rs. 30,03,946/- received as advance commission in the AY 2010-11 and treated as income in the year under reference." 4.1 AO further observed that Department has not accepted the order of the Ld. CIT(A) for AY 2010-11 and the Departmental Appeal is pending before the ITAT. During the assessment proceedings for AY 2010-11, the AO had show-caused the assessee on this issue wherein the assessee had contended as u....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion'. It is mentioned in the Notes on Account that the Commission (Overseas) are recognized on realization basis. In contrast to the same, the assessee is treating the Commission as advance Commission to defer the liability of tax and to adjust this will fully in future in the P & L account. 4.4 Further, the assessee has submitted that advance commission amounting to Rs. 30,03,946/-, pertaining to AY 2010-11, has been treated as income in the AY 2011-12. In view of the above fact, it is clear that Advance Commission amounting to Rs. 32,90,089/- booked under the head "Sundry Creditors for Advance" solely pertains to AY 2011-12. Since the facts of the year AY 2011-12 are similar to AY 2010-11, the treatment of Rs. 32,90,089/- as Advance comm....