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Issues involved: Appeal against order of CIT(A) confirming disallowance of commission expenses and addition of share application money u/s. 68 of the Income Tax Act, 1961.
Commission Expenses Issue: The appeal by the assessee challenged the disallowance of commission expenses of Rs. 4,00,000. The assessee contended that the disallowance was unjustified and uncalled for. The assessment was framed u/s. 144 of the Act, and the assessee claimed that no opportunity was given to present relevant documents due to police seizure of records. The assessee requested for a reconsideration of the issue by the Assessing Officer to provide an opportunity for proper representation. The CIT(A) was noted to have relied on a wrong conclusion in the case of Lovely Exports (P) Ltd. The Tribunal set aside the issue to the file of the Assessing Officer for fresh adjudication, allowing the assessee to submit documentary evidence to support the claim. Share Application Money Issue: The appeal also contested the addition of share application money amounting to Rs. 4,54,88,000 u/s. 68 of the Act. The assessee argued that the addition was not tenable in law and did not comply with legal requirements. The assessee, due to the seizure of records, could not cooperate during the assessment proceedings. The Tribunal, in the interest of natural justice, set aside the issue to the file of the Assessing Officer for a fresh decision. The Assessing Officer was directed to re-adjudicate the issue considering the evidences filed by the assessee in accordance with the law. The appeal of the assessee was allowed for statistical purposes. Conclusion: The Appellate Tribunal ITAT KOLKATA allowed the appeal of the assessee for statistical purposes, setting aside both the issues of disallowance of commission expenses and addition of share application money u/s. 68 of the Income Tax Act, 1961, for fresh adjudication by the Assessing Officer to ensure proper opportunity for the assessee to present its case.
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