9911796707
|
Home
Issues involved: Disallowance of commission fees u/s 143(3) for assessment year 2007-08.
Assessment Proceeding Observations: The Assessing Officer disallowed commission fees of &8377; 17,05,716 paid to a related company, M/s North Point Training & Research Pvt. Ltd., as no evidence of services rendered was produced. Directors of the related company were also members of the AOP of the assessee company. Assessee's Submission: The assessee AOP hired the related company for managing its training and research activities. The company's directors were experienced in finance and accounts. The commission fee was justified as the company offered the commission as income and paid taxes on it. The assessee had paid similar commission in previous years without disallowance. Tribunal's Findings: The Tribunal noted that the related company had shown its receipts in profit and loss account and offered the fee for taxation. The services provided by the company were detailed in an agreement and confirmed by a certificate. The disallowance was deemed unjustified based on consistency with previous years and the company's compliance with tax obligations. Conclusion: Considering the evidence provided and the history of commission payments, the Tribunal deleted the disallowance of commission fees for the assessment year 2007-08, allowing the appeal of the assessee.
|
