9911796707
TMI Blog2014 (3) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... payment made by the assessee in the form of cheques through vehicle dealers to the customers is a grant of rebate and discount - the assessee was not under any obligation to comply with the provisions of section 194H of the Act - the Assessing Officer wrongly invoked the provisions of section 40(a)(ia) of the Act – Decided against Revenue. - ITA No.3524/Del/2012 & CO No.28/Del/2013 - - - Dated:- 13-12-2013 - G D Agrawal And Chandra Mohan Garg, JJ. For the Appellant : Shri Navin Gupta For the Respondent : Shri Sameer Sharma, Sr DR ORDER:- PER : Chandra Mohan Garg The above captioned appeal of the revenue as well as Cross Objection of the assessee have been preferred against the order of the Commissioner of Income Tax(A), Rohtak dated 30.04.2012 in Appeal No. 376/RTK/2011-12 for AY 2006-07. It is pertinent to mention that the appeal of the revenue and C.O. of the assessee have arisen from the same order of Commissioner of Income Tax(A), therefore, we have clubbed both and these are being adjudicated by this consolidated order. 2. First of all, we take up the appeal of the revenue wherein sole ground reads as under:- On the facts and in the circ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d out that for getting the customers and undertaking due diligence and loan and repayment responsibilities, HDFC Bank pays commission to the assessee directly. The counsel further pointed out that in order to attract customers and to improve business, the assessee passes on part of the commission to the customer by directly issuing cheque in the name of the dealer from which the customer is going to purchase the vehicle for which the loan has been sanctioned. The counsel also pointed out that the vehicle dealer maintains ledger account of customers wherein the cheque issued by the assessee towards rebate and discount is credited to the respective accounts of the customers and no account of the assessee is maintained by the vehicle dealer in this regard. The counsel of the assessee vehemently contended that there is no relation between the assessee and the vehicle dealer under which any commission has to be paid and if for the sake of argument, we presume that the commission has to be paid, then also the assessee is providing business to the vehicle dealer and under this obligation, vehicle dealer is under obligation to pay commission or any other remuneration to the assessee but in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o.these expenses are neither on account of payment of commission to any person nor these expenses are on account of contract with the person. In support of his contention, the assessee could not furnish any concrete evidences that the payments of Rs. 28,48,2461- were made to the ultimate consumers/end-user and not to the intermediaries and impliedly the sub-agent of the assessee as is evident from self-admission of the assessee cited supra. In these circumstances, I have no other alterative, but to make an addition of Rs. 28,48,246/- to the already assessed income of Rs. 2,79,540/- under section 40a(ia) as the assessee failed to comply the provisions of section 194B by not deducting the tax on said payments. 6. On the other hand, from the impugned order, we also observe that the Commissioner of Income Tax(A) has granted relief to the assessee with following observations and findings:- 7. I have considered the issue and the submissions made by the AR. The assessee is a DMA of HDFC Bank for arranging finance to old and new process and documentation for arranging the finance is as under:- A customer approaches the assessee for arranging vehicle loan from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e unable to accept this conclusion of the Assessing Officer that the assessee made payments to the intermediaries and impliedly the sub-agents of the assessee. Per contra, we have no hesitation to hold that the assessee was not getting any services from the vehicle dealer and there was no occasion to make any payment of commission to the vehicle dealers. On the other hand, if the assessee is sharing a part of commission received as remuneration from HDFC Bank in order to attract customers to improve volume of business, then the payment made by the assessee to the customers by issuing cheque in the name of vehicle dealers cannot be said to be a payment of commission. The DR has not disputed his point that the vehicle dealer maintains major account of the customers wherein the cheques issued by the assessee towards rebate and discount is credited to the respective accounts of the customers and the vehicle dealers are not maintaining any account of the assessee in this regard. 8. In the light of discussions made hereinabove, we are of the firm view that the Assessing Officer made additions on hyper technical grounds which was rightly deleted by the Commissioner of Income Tax(A) aft ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
