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TMI Blog2002 (4) TMI 887X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of commission. The Tribunal had further held that the First Appellate Authority should allow an opportunity to the Assessing Officer to put forward his claim to justify the disallowance of commission made by him while framing the assessment but no person to whom commission had been paid was produced and the Assessing Officer was also not allowed to put forward his arguments to justify the disallowance made while framing the assessment. Therefore, the ld. CIT(A) s order is clearly not sustainable in law. 3. The ld. CIT(A) has also erred on the facts and in the circumstances of the case, in allowing relief out of salary disallowance and other disallowances pertaining to car, travelling and sales promotion expenses." 3. The assessee in the cross objection has taken the following grounds : "1. That on the facts and in the circumstances of the case, the CIT(A), was not justified in sustaining a disallowance of Rs. 30,000 out of the commission paid at Rs. 2,19,988. The CIT(A), should have allowed the commission paid at Rs. 2,19,988 in toto . The authorities below did not appreciate that this commission was paid by cheque and it was necessary in the interest of business. The c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble portion of the commission was allowed. It was specifically stated that the commission was being paid right from the assessment year 1977-78 to the assessment year 1985-86 i.e., upto the working of the firm. It was stated that the commission has to be paid in this line of business without which no concern can carry on the business. These payments were being made in accordance with the prevailing practice in the business carried on by the assessee and this has been accepted in the past as well as in the subsequent years. 5.1 The learned CIT(A) observed that the payment of commission to the Dyeing Master was prevalent practice in the assessee s line of business. According to him, the assessee was paying commission during all the years prior to the assessment year under consideration and also in the subsequent assessment years. The learned CIT(A) has observed that the payment of commission has been accepted except in two years i.e., 1982-83 and 1984-85. According to him, the payment was being made by cheques and there was no material to doubt the same. However, the learned CIT(A) disallowed the sum of Rs. 30,000 on ad hoc basis. 6. Before us, Shri S.K. Maingi, the lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ashok Kumar, Agnihotri 2,654 1978-79 to 1982-83 2. Charanjit Mehra 5,830 1980-81 to 1982-83 3. Sohan Lal 1,472 1980-81 to 1982-83 4. Sanjeev Kumar 14,350 1980-81 to 1982-83 5. Krishan Lal 690 1981-82 to 1982-83 6. Satish Kumar 12,472 1980-81 to 1982-83 7. Vinod Kumar 2,410 1980-81 to 1982-83 8. Bhadar Sain 10,190 1980-81 to 1982-83 9. Vipan Kumar 9,174 1980-81 10. A.K. Shukla 13,143 1982-83 11. Ramesh Kumar 13,335 1982-83 It is stated that the above information was also furnished before the Assessing Officer as well as before the CIT(A) Shri P.N. Arora, Advocate, the learned counsel for the assessee, submitted that since the commission paid to the above parties amounting to Rs. 85,720 was accepted as a genuine payment for the earlier assessment years, the Assessing Officer was not justified in disallowing the commission paid in the assessment year under consideration. As regards the balance co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the assessee s line of business, no commission was being paid. According to the assessee, these expenses have to be incurred for carrying on day to day business. The payment of commission on the sale of dyes and chemicals and paints is necessitated for securing more of business and all the payments were made by means of payee account cheques. There is no material on record to doubt the genuineness of payment. Considering the entire relevant facts of the present case, we do not find any infirmity in the order of the CIT(A) on this issue and accordingly we uphold the same. 8. The next ground of appeal is directed against the action of the CIT(A) in allowing relief out of salary disallowance and other disallowances pertaining to the car, travelling and sales promotion expenses. The Assessing Officer observed that a sum of Rs. 14,400 has been debited being salary paid to Shri Raj Kumar, Manager of the assessee-firm. Sri Raj Kumar is the son of Smt. Daya Wanti, partner. According to the Assessing Officer the salary paid to Shri Raj Kumar was excessive. He, therefore, disallowed a sum of Rs. 5,400. In further appeal, the CIT(A) allowed the claim of the assessee. 9. Shri S.K. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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