TaxTMI 
TaxTMI 
2022 (11) TMI 1259
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....which were examined on test check basis. 2.1 During the course of assessment proceedings, the Assessing Officer, noticed that the Assessee had debited expenses of Rs.4,80,000/- to its profit and loss account under the head "commission to others", therefore the Assessee was show caused to explain the commission expenses incurred by the Assessee, being a Medical Doctor by profession. In response to the show cause notice, the Assessee vide reply dated 25.08.2017 submitted as under: "That in view of the competitive market and to be retained in medical practice, the Assessee had to make various expenses to generate new cases and that the Assessee has deducted proper tax at source on such payments towards commission. Copy of TDS certificate and income tax returns of the recipient of commission were also filed before the Assessing Officer. The Assessee further submitted that the commission is paid purely for the purpose of the business and therefore, such payment is an allowable expense." 2.2 The Assessing Officer, after considering the reply of the Assessee observed that the Assessee is a Doctor and is barred by Medical Counsel Rules from giving of and receiving any commis....
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....aking roving and fishing enquiries on other aspects of the case and asked the Assessee for documents and information relating to other heads of expenses, for which the Assessing Officer had no jurisdiction to extend the proceedings beyond the limited scrutiny, that too without seeking any approval from the designated authority and giving an opportunity to the Assessee to contest the same. Therefore, the assessment proceedings are vitiated on this legal aspect of the case only." 3.2 The ld. Commissioner, after considering the contentions of the Assessee on merit, sustained the disallowance made by the Assessing Officer on the premise that there is contradiction between the statements of the Assessee made before the Assessing Officer and that made in the appeal proceedings, inasmuch as, before the Assessing Officer, the Assessee claimed the expenses under the head commission to others and submitted that under the competitive market and to be retained in practice he has to make various expenses to generate new cases, whereas in the appeal proceedings, he stated that the amount was paid to a marketing agency hired by the Assessee to improve business, better management of patients, c....
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....nostic Lab or Chemist or any other party engaged in any medical related activity. 5.2 We have given thoughtful consideration to the contradictory stand taken by the Assessee before the Assessing Officer and the ld. Commissioner. The Apex Court time and again reminded that the receiving of any freebies, bonus or commission, etc. by medical practitioner(s) from the allied health industry including hospitals for referring any patient by them for medical investigation, surgical, or other treatment purposes is prohibited under The Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002 (in short "the Regulations"). In the same way clause 6.4.1 of the regulation prohibits the medical practitioner (s) from giving, soliciting , or receiving or offering to give any gift, gratuity, commission or bonus in consideration of or return for the referring, recommending or procuring of any patient for medical, surgical or other treatment. Further prohibits the medical practitioner (s)from directly or indirectly, participating in or be a party to act of division, transference, assignment, subordination, rebating, splitting or refunding of any fee for medical, surgi....
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....pursue. This can be achieved by statutorily mandating the Courts to become active seekers of truth. To enable the courts to ward off unjustified interference in their working, those who indulge in immoral acts like perjury, prevarication and motivated falsehood, must be appropriately dealt with. The parties must state forthwith sufficient factual details to the extent that it reduces the ability to put forward false and exaggerated claims and a litigant must approach the Court with clean hands. It is the bounden duty of the Court to ensure that dishonesty and any attempt to surpass the legal process must be effectively curbed and the Court must ensure that there is no wrongful, unauthorised or unjust gain to anyone as a result of abuse of the process of the Court. One way to curb this tendency is to impose realistic or punitive costs. 5.5 A litigant is not only required to come with clean hands and bound to make full and true disclosure of facts, but it is imperative to come with clean mind, clean heart and clean objective that are the equi-fundamentals of judicious litigation. One should not be enriched by the loss or injury to another, is the percept for Courts. The jurisdicti....