TaxTMI 
TaxTMI 
2019 (7) TMI 702
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....disallowed an amount of Rs. 13,60,869/- on account of commission payment to M/s. Wise Agencies Pvt.Ltd. 4. It is noted from the record in explanation to the AO's objection, the assessee stated that commission @ 5% was paid to M/s. Wise Agencies Pvt.Ltd. and such payments were made through banks duly deducting TDS. The AO held the submissions of assessee not tenable and added that amount to the total income of the assessee. 5. In the first appeal before the CIT(A), same arguments were advanced. The CIT(A) held that submissions of PAN card and registration certificate are not sufficient to prove the genuineness of commission payment. The assessee did not take steps in bringing the concerned persons of M/s. Wise Agencies Pvt.Ltd. for verification and confirmed the order of AO as under:- "Perusal of submission shows that appellants has placed reliance over the decision of Honourable lTAT KOK. ITA No.1701/Ko1/2014 in case of Ashok Kumar Agarwal. Wherein the fact of the referred case is that, lower TD5 deduction was submitted by the commission agent and those entire commission agents were traceable. In this case the facts of the case are different and it is seen that this ....
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.... of the Act. He referred to page No.51 of the Paper Book and submitted that the Directors of the said company was resolved to make an application to the Registrar of the Company, West Bengal to strike the name of the Company off the registrar. He argued when the company passes resolution to strike off its name from the Registrar of companies which is evident from the record, there is no point in making the additions in the hands of the assessee for non-verification of details from the said M/s. Wise Agencies Pvt.Ltd. Further he submits that the assessee has given every detail before the AO i.e. copies of accounts, copies of bills, resolution dated 19.11.2011, certificate u/s 191 of the Act, copy of Agreement etc. But, however, both the authorities below ignored the same. The Ld.DR relied on the order of AO & CIT(A). 7. Heard both parties and perused material available on record. According to AO, the assessee failed to bring concerned persons for verification in the proceedings u/s 133(6) of the Act. But, however, the fact remains admitted that the assessee filed all details relating to the transactions that have taken place with M/s. Wise Agencies Pvt.Ltd. before the AO. Even....
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....t. Ltd. cannot be said imaginary and bogus. Therefore, the ratio laid down by the Hon'ble High Court of Calcutta in the case of M/s. Inbuilt Merchant Pvt. Ltd.(supra) is clearly applicable to the facts on hand. Thereby, the addition made by the AO and as confirmed by the CIT(A) is not maintainable. The relevant portion of observations of Hon'ble High Court of Calcutta in the case of M/s Inbuilt Merchant Pvt. Ltd. (supra)is reproduced hereunder for ready-reference:- "The views expressed by the Assessing Officer are erroneous in law. The Assessing Officer has overlooked the importance of the books of accounts maintained in the ordinary course of business. Reference in this regard may be made to sub-section (2) of Section 32 of the Indian Evidence Act, 1872. The books of accounts maintained in the ordinary course of business are relevant and they cannot be discarded in the absence of appropriate reasons. The mere fact that recipient did not reply in some cases or they were not found at the address furnished by the assessee does not in the least prove the fact that they were non existent or that the payments shown to have been made by the assessee were imaginary. With the a....
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....ot be countenanced. We note that the AO has disallowed the commission simply on surmises without bringing any evidence on record to the contrary but on presumption that the Jessop companies building was in dilapidated condition etc or that the telephone made by the AO was not picked up by the employee of Jessop Co. Ltd cannot be a ground for disallowing the commission. Furthermore, we note that the parties to whom commission was paid were not relatives of the assessee. There is no evidence that the commission paid has come back to the assessee. Our attention was drawn to the following cases wherein it has been held that if there is no evidence to show that the agents were relatives of the assessee and that the commission paid has not come back to the assessee, then it cannot be said that the commission paid was not genuine. For the said proposition we rely on the Judgment of the Hon'ble Kolkata High Court in the case of Commissioner of Income Tax Vs Inbuilt Merchants Pvt Ltd in ITAT No. 225 of 2013, GA No. 2825 of 2013 wherein it was taken note by the Hon'ble High Court that with the advancement of the Technology it has become possible to sell goods throug....