9911796707
TMI Blog2012 (9) TMI 795X X X X Extracts X X X X X X X X Extracts X X X X ..... ome from commission/service charges from direct marketing/selling agency of ICICI Bank Ltd. on car loan sanctioned through it. The total commission/service charges received during the year was at Rs.6786,740/- against which the net profit was shown at Rs.5,98,932/-During the course of assessment proceedings, the assessee produced list of parties to whom commission of Rs.35,65,096/- was paid by the assessee. The confirmations of certain parties were also submitted before the Assessing Officer. The Assessing Officer made certain enquiry from ICICI Bank and found that the assessee has issued bearer cheques in the name of parties receiving commission but the same has been encashed by the assessee itself which is evident from the noting given in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the course of completing the assessment of the assessee firm for A.Y. 2005-2006 on the basis of the declaration made by the assessee firm vide submissions dated 31.12.2007 in respect of the parties/sub brokers to whom commission has been paid, but are not available or traceable and in respect of whom no confirmations have been submitted during the course of assessment. In this connection we would like to reiterate that the aforesaid parties to whom the commission has been paid are genuine and in existence/present, but the confirmations or complete addresses where of could not be furnished during the course of hearing. This is more particularly because all of them were one timers and no sufficient time was available either to trace their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agreed addition of disallowance of commission paid was made by the assessee purely to buy peace and not otherwise." The Assessing Officer rejected the said submissions of the assessee and relying on the findings given in the assessment order, levied a penalty of Rs.63,506/- on the commission disallowed at Rs.1,73,549/-. 4. In the first appeal, the assessee made detailed submission, which has been incorporated at page 2 and 3 of the impugned order. The sum and substance of these arguments were that the assessee had paid commissions to so many persons and confirmation and addresses in most of the cases were filed and the same has been accepted. All the payments have been made through account payee cheques, however, in respect of payments, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer as well as CIT(A). 6. We have carefully considered the rival submissions and perused the findings given by the Assessing Officer as well as CIT(A). From the perusal of the penalty order, it is seen that the Assessing Officer has solely relied upon the findings given in the assessment order, without giving a specific finding as to why the explanation offered by the assessee is false. Even though the addition has become final in the assessment proceedings, however, such a finding in the assessment order is not a final word in the penalty proceedings upon the pleas which can be taken up at the penalty stage and whatsoever relevant and good the findings are given in the assessment proceedings, they are not conclusive so far ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccepted. Even the presumption raised in Explanation 1 to Section 271(1)(c), is a rebuttable presumption and there is always a preponderance of probabilities that the assessee was acting bonafidely and the explanation offered by him is a probable view. The Assessing Officer has not carried out any enquiry or has brought any material on record to show that in all the cases of commission paid to sub-brokers were bogus. The explanations offered by the assessee have not been found to be false. Under these facts and circumstances of the case, we hold that penalty for concealment of the income under Section 271(1)(c), cannot be levied and hence, same is deleted.
7. In the result, the appeal of the assessee is allowed. X X X X Extracts X X X X X X X X Extracts X X X X
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