TaxTMI 
TaxTMI 
2018 (10) TMI 1118
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....made by the AO. 2. The CIT (Appeals) while upholding the disallowance impugned, did not consider the detailed submissions supported by evidence and case law made by the appellant but chose to follow the order of his predecessor contrary to the settled legal position that principles of res judicata do not apply to tax proceedings." 3. The assessee is a Private Limited Company and is engaged in manufacture of Industrial explosives and sales thereof. The assessee filed return of income on 25/10/2005 showing a loss of Rs. 34,18,708/-. The case was selected for scrutiny. Accordingly, notice u/s 142(2) dated 18/8/2006 was issued and served upon the assessee. In compliance thereof, the Assessee's Representative attended the assessment proceed....
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....y claimed expenses for commission of Rs. 14,38,510/- and incentive of Rs. 77,835/-. The assessee replied to the Assessing Officer that the commission and incentive were paid for handling and getting the order from the Coal India Limited as well to pursue in realizing the payment. The Assessing Officer made addition of Rs. 15,16,345/- in respect of payment of incentive and commission. 4. Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) partly allowed the appeal of the assessee. 5. The Ld. AR submitted that the assessee is challenging disallowance of commission and incentive paid at Rs. 15,16,345/- in the present appeal. The Ld. AR submitted that the Assessing Officer as well as the CIT(A) ign....
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....in case, the assessee was to perform by employing its own staff to deal with such faraway clients otherwise the expenditure would be much more. The Ld. AR further submitted that the expenditures was incurred for the business of the assessee who is best equipped to decide as to which type of expenditure is suitable for the business. The Ld. AR submitted that the Assessing Officer cannot judge the decision of the assessee and decide otherwise. The Ld. AR relied upon the decision of the Hon'ble Punjab & Haryana High Court in case of CIT Vs. Bharat Medical Store (2009) 308 ITR 373 (P &H) as well as Escorts Ltd. Vs. ACIT (2007) 104 ITD 427 (Delhi) and Bulk Explosive Ltd. vs. DCIT in ITA No. 1216/Del/2011 order dated 28th June, 2013 (Delhi). The ....
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....whether the claim is justified specifically as it is ;for the purpose of procuring orders from a government concern. The First Appellate Authority followed the ofder of his predecessor for the Assessment 'Year 2002-03 and upheld the disallowance. On a query from the Bench the Ld. Counsel submitted that this addition has not been challenged previously by the assessee during the Assessment Year 2003-04, for the reason that the amount was small. A perusal of the order of the Ld. Commissioner of Income Tax (Appeals) for the Assessment Year 2003-04 demonstrates that the disallowance was upheld on the ground that commission of 3% paid for handling and getting order from M/s Coal India Ltd. and to pursue the realization of payments, was not ju....
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....rs of Coal India Limited are located at Kolkata and in case the assessee company was to place some of its employees .at such afar of place then, the expenditure on salaries etc. may be much more or equivalent to the claim which is being made on account of commission etc. The A.O has not doubted the payment or its genuineness and neither has he complete details in respect of the payments including details of TDS are furnished. It may be emphasized at this stage that in respect of one of the commission agents namely M/s Combined Associates Singrauli, the Income Tax Department at Satna had issued a certificate on 14.05.2004 for deduction of tax at source at a lower rate vis-a-vis section 197(1) of the I.T. Act (page 39 of the paper book)" 1....
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.... to itself. Therefore, these are questions of fact as has been held by a Division Bench of this Court in the case of CIT vs. Ishwar Prakash and Bros.(1986) 159 ITR 843 (P&H). Likewise, reliance could be placed on a judgement of the Hon'ble Supreme Court in the case of Shahzada Nand and Sons vs. CIT'(.1977) 108 ITR 358, wherein it was held that the commission paid to the two employees of the assessee film was reasonable having regard to all the circumstances of the case and was allowable as a deductible expenditure u/s 36(l)(ii) of the Act. The Hon'ble Supreme Court was dealing with a matter in respect of the AYs 1960-61 to 1963-64." 15.1. The Hon'ble Delhi High Court in the case of Sidhardha Trading Ltd. 206 Taxman 92, upheld the fin....