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Issues involved: Appeal against deletion of addition made by Assessing Officer on account of disallowance of foreign buyer's agent commission u/s 37 r.w.s. 93 of the Income-tax Act, 1961.
Summary: The appeal by the Revenue challenged the deletion of an addition made by the Assessing Officer regarding disallowance of foreign buyer's agent commission. The confirmation letter from the agent was furnished during assessment proceedings, confirming their role as a commission agent for the assessee. Despite the agent being located in a foreign country, detailed information was sought and provided, establishing the genuineness of the transactions. Various confirmations from different parties were presented, supporting the commission payments made directly to the agents. The Tribunal found the evidence conclusive and in line with previous decisions, allowing the deduction u/s 37(1) of the Act. The Tribunal emphasized the necessity of deducting commission from export invoices as per agreements between buyers and sellers, highlighting the diversion of income by overriding title. The Tribunal also referenced the principles laid down by the Hon'ble Gujarat High Court regarding commission payments. Ultimately, the Tribunal confirmed the CIT(A)'s decision to delete the addition, dismissing the Revenue's appeal. In conclusion, the Tribunal upheld the deletion of the addition made by the Assessing Officer concerning the disallowance of foreign buyer's agent commission, based on the conclusive evidence provided and in accordance with relevant legal principles.
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