TaxTMI 
TaxTMI 
2023 (8) TMI 626
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....peared on behalf of the assessee, nor any adjournment was sought for. Having no other alternative, we have decided to proceed with the matter ex parte upon hearing the Ld. DR and perusal of the records including the orders passed by the authorities below. 3. The brief facts leading to the case is this that the assessee is a Limited Company, carrying on business of manufacturing of Forged Flanges & Pipe Fitting under the name and style of M/s. Aditya Exim Limited. In addition it also carries on trading activity of shares & securities and is assessed by the DCIT, Circle-1(1), Vadodara. The assessee filed its return of income on 24.09.2011 declaring total income at Rs. 59,61,060/-, which was processed under Section 143(1) of the Act and requisite notice under the Act were duly issued. The assessment was ultimately finalized by the Ld. AO on 29.03.2014 upon making additions inter alia as follows: 1. Sales Commission Rs. 4,70,711 2. Travel expense Rs. 1,53,133 3. Sales Promotion Rs. 2,89,095 4. Other expense Rs. 6,97,661 4. The addition in respect of sales commission to the tune of Rs. 4,70,711/- is under challenge before us. 5. During ....
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....f one of the debtors of the assessee company is the name and style of M/s Ferrofusion. Even the contact numbers of the said agent is that of the debtor company and the contact Email-ID is that of the debtor company M/s Ferrofusion. The assessee company has failed to produce the invoices and vouchers for the said sales commission and has also furnished the quantitative details and rate of commission on the basis of which such commission has been computed. In light of the above, the genuineness of the expenditure of sales commission is not established and I hereby, disallow the same. Therefore, an amount of Rs. 4,70,711 /- is added back to the income of the assessee. Penalty proceedings under section 271(1)(c) of the Income-tax Act, 1961 are also initiated as the company concealed the particulars of income and furnished inaccurate particulars of income. (Addition: Rs. 4,70,711 /-) 6. As the genuineness of expenditure of sales commission has not been found to be established by the assessee, the same was added to the total income of the assessee, which was, in turn, confirmed by the First Appellate Authority. Hence, the instant appeal filed before us. 7. Before the Fi....
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....hat is important is just terms of agreement and same should be duly signed. Uses of seal is not having such relevance that in absence of the 'Seal' it losses it's validity. Invoices and vouchers are not produced Lr.A.O. ignored the vital fact that Ledger copy and confirmations were provided during scrutiny proceedings. Need not to say that in case of export and import businesses various other agencies are Involved viz. Excise Opt, VAT Dept., FEMA and Banking channels. Hence quest/on of in-genuine does not arise at all as any bogus transact shall attract lots of rigorous applications of law. Lr.A.O. while assessing has verified and accepted the 'Export Sales'. Meaning thereby Sales shown in the Ledger as we/I as in the calculations of Sales Commission are well accepted. Further the same was never demanded during scrutiny proceedings. For your ready reference we are producing herewith copies of vouchers. Invoices, Bank payment documents, Commission sales agreement & ledger copy at Annexure-1. Since the base of disallowance is wrong and bad in law the same deserves to be quashed. Your Honor is requested to delete disallowance of genuine --&#....
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....he quantitative details and details of sales on the basis of which such commission had computed and paid. No such evidences or details were furnished during the course of the current appellate proceedings also. Under such circumstances, it is that the claim of commission made by the appellant is bogus and hence, the action of the AO of disallowing the same is upheld." 9. It appears from the records that the assessee has filed a fabricated agreement during the course of appellate proceeding in order to justify the claim made by him, as the agreement was stated to be executed on 01.04.2011 but the date mentioned in such agreement was 01.04.2010. Nonetheless except for this agreement, the assessee not produced any invoice or voucher of the sales commission neither furnished quantitative details or details of sales of which commission had been computed and paid. In that view of the matter, we find no ambiguity in such order passed by the Ld. CIT(A), particularly, in the absence of any assistance made by the assessee before us. The order passed by the authorities below is found to be just and proper so as to warrant interference. The same is, therefore, upheld. The assessee's this gr....
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.... 15. During the course of assessment proceedings, it appears that the assessee has shown Rs.6,97,661/- as other expenses claiming as debited in P&L account of the assessee during the year under consideration, whereupon, detailed split of such 'other expenses' were directed to be submitted. The Assessee submitted as follows: "Ledger statements and copy of debit notes is attached which is self-explanatory. Further, the damage charges amounting to USD 13221.22 ie. Rs. 6,20,736/- are debited for loss in transit incurred against shipment to Norca Industrial Co. vide Invoice No. AEL/051. And damage charges amounting to USD 1700 Le. Rs. 76,925/- are debited for cleaning and painting rusted material gone against Invoice No. AEL/036 to M/s. Dodson Global Inc." 16. The detailed quantification or basis on which such expenses were booked was not reflecting from the invoice submitted by the assessee neither such invoices contained any stamp, seal, inward mark or receipt date and therefore, the same was found to be bogus. In the absence of proper invoices and vouchers, the same were added. 17. Before the First Appellate Authority, the assessee submitted the following: "5.....
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....stamp, seal, inward mark it could not be recognized as 'Bogus' * All proper invoices and vouchers are available and the copy of the same are attached herewith at Annexure-2 Lr.A.O. qualified the same as 'Bogus' with an observation that it does not contain stamp, seal, inward mark and so on. If your appellant want to go for Bogus claim into genuine claim, this is the criteria making stamp, seal inward mark etc. would not have cost even Rs. 100/-Does this mean by spending Rs. 100 your appellant should have made it genuine? This is not a base and background to qualify the same as 'Bogus'. Your appellant failed to understand what leads A.O. to qualify it as Bogus? (Just because there is no stamp, seal and Inward mark!!!) The communication received through mail has no value? Since the base of disallowance is wrong and bad in law the same deserves to be quashed. Your Honor is requested to delete disallowance of Other Expenses amounting to Rs. 697,661/-." 18. In the absence of any evidence and relevant details, the Ld. CIT(A) upheld the disallowance of claim of expenses except to the tune of Rs. 76,925/-, which has been issued by th....