9911796707
TMI Blog2014 (1) TMI 884X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer – matter remitted back to the AO for fresh adjudication. The AO made disallowance of 30% of remuneration paid to directors as excessive remuneration and in the absence of services proof of rendered by the directors – the Assessing Officer does not mention about the fact of income tax returns of the directors - this point should also be readjudicated by the Assessing Officer in the light of income tax returns of directors having been filed before him – Relying upon Assistant Commissioner of Income-tax, Circle 3(1), New Delhi Versus Bony Polymers (P.) Ltd. [2009 (11) TMI 658 - ITAT DELHI] - The Assessing Officer can compare the salary paid by assessee to its directors from their income tax returns and if the salary received f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and by letter dated 29.10.2009, the assessee was required to furnish details regarding services provided by these commission agents and business generated through these agents. The assessee in its written submissions dated 11.11.2009 submitted as under: " As required the detail of commission paid to persons for the services provided to company during the A. Y. 2007-08, along with the tax deducted at sources is as under: Name Amount paid TDS Cheques No. Shailendra Batra 62500/- 3188/- 165027 Anupma Singh 62500/- 3188/- 165027 Ramesh Kumar 52687/- 2687/- 182327 Ajay Sharma 2000/- - 184814 Nidhi Khare 120000/- 6120/- 232687" 3. The Assessing Officer disallowed the amount of commission on the basis that no documen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the purchase order. Such letters have been filed in the case of Sh.Ramesh Kumar, Anupama Singh Rana, Sh. Ajay Sharma, Nidhi Khare and Sh. Shailender Batra. All these letters were stated to have been produced before the Assessing Officer in the course of assessment proceedings. In view of all these details and evidences which are stated to be a part of record, it is held that the Assessing Officer is not justified in making the disallowance of commission of Rs.2,99,687/-. As the payments have been made by account payee cheque and the letters identifying the service rendered by the commission agent are on record, the disallowance of commission of Rs. 299687 is held to be unjustified. Accordingly, the disallowed of Rs.299687 is deleted." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee. Therefore, she argued that additions and disallowances were rightly made by Assessing Officer. 7. The Ld. AR on the other hand, submitted that commission was paid through crossed cheque and TDS was deducted thereon and further, submitted that payees had confirmed receipt of commission on purchase orders. Therefore, the Ld. CIT (A) had rightly deleted the commission. 8. With respect to disallowance of directors remuneration, he argued that due to consistent efforts of directors the turnover of company's has increased from Rs.15.78 crores to Rs.21.55 crores from assessment year 2005-06 to A. Y.-2007-08 and similarly profit of the company had increased from Rs.5.33 lacs to Rs.48.92 lacs during the same period. It was further argued th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turns of the directors. Therefore, we are of the view that this point should also be readjudicated by the Assessing Officer in the light of income tax returns of directors having been filed before him. The Assessing Officer can compare the salary paid by assessee to its directors from their income tax returns and if the salary received from the assessee forms part of income of directors in their personal capacity, wherein, taxes has been paid, then he can arrive at the right conclusion keeping in view of the Ld. CIT (A)'s reliance on ITAT judgment in Bony Polymers Pvt. Ltd. to ascertain as to whether there was any loss of Revenue or not. In view of the above, the appeal filed by the Revenue is allowed of statistical purposes. Order pronou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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