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TMI Blog2014 (9) TMI 493X X X X Extracts X X X X X X X X Extracts X X X X ..... e ground that the assessee was not having proper voucher supporting details and expenses were incurred in cash only –it was not fully verifiable under the given circumstances – the assessee had closed down his business within four months, thereafter he lost his connection with all the supplier of servicer for which he made the payment, a reasonable amount may please be confirmed – the disallowance at ₹ 25,000/- is justifiable – Decided partly in favour of assessee. - I.T.A. No. 197/JP/2012 - - - Dated:- 5-9-2014 - Shri R. P. Tolani And Shri T. R. Meena,JJ. For the Petitioner : Shri P.C. Parwal. For the Respondent : Shri D.C. Sharma. ORDER Per: T. R. Meena, A.M. This is an appeal filed by the assessee against the order dated 19/2/2011 of the learned CIT(A)-III, Jaipur for the A.Y. 2007-08. The effective grounds of appeal are as under:- (1) The learned Commissioner of Income Tax (Appeals) has erred on facts and in law in confirming the disallowance of ₹ 18,14,226/- made by the A.O. out of commission payments of ₹ 24,18,968/- (2) The learned Commissioner of Income Tax (Appeals) has erred on facts and in law in confirming ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Details S. Nos. of the Table Amount (in Rs.) 1 Summons returned 8,10,11,14,16,17,18,23,24, 28, 30,33,34,39,40,41,44 to 49 7,94,386/- 2 Non compliance by the witnesses 1,2,5,20,26,29,31,37 42 6,06,215/- 3 Denied of having received any commission 3,9,12,21 3,00,057/- 4 Partially admitted to have received commission 4,6,7,13,15,19,22,25,27,32, 35, 36,38,43 4,11,000/- out of ₹ 7,46,160/- It is held that witnesses have confirmed to receive ₹ 4,11,000/- only that to out of ₹ 7,46,160/- as claimed by the assessee. Commission payment of ₹ 17,00,640/- remained unverifiable for want of either production of supporting evidences or for production of witness/denial by the witnesses. As per the Assessing Officer, the assessee did not have supporting evidence for claim of commission of ₹ 24,18,968/-. The Assessing Officer allowed 25% of commission at ₹ 6,04,742/-, but disallowed 75% commission claimed at ₹ 18,14,226/-. 3. Being aggrieved by the order of the learned As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were due to laps of time involved in the entire process as such. It was also claimed that the mammoth work of distribution to tele products in remote areas could not have been possible, without the aid/help of such retailers/distributors. The learned AR also argued that the NP declared by the assessee at 5.06% is reasonable, under the given circumstances. Accordingly, it is submitted that the disallowance of ₹ 18,14,226/- being 75% of the expenses claimed by the assessee in this regard is unreasonable and uncalled for. 2.3.1 In the light of the above factual discussion, it is undisputed fact that the appellant has miserably failed to establish the genuineness and correctness of the commission of ₹ 24,18,968/-, so much so that even the summons issue in this regard, were remained largely un-served/uncomplied with. Regarding the onus aspect, the courts have held that to claim any expenditure as allowable U/s 37(1) of the Act, the primary onus lies on the claimant of such expenses i.e. on the assessee only. Unless he proves such claim with proper reasons and supporting documents, the department is justified in treating such expenses as an inadmissible expenditure, as su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent was made in the month of December, 2009 and business was closed, therefore, the assessee was no touch with these commission recipients. Some of the commission recipients had migrated from Sikar to other part of the country in search of employment. The A.R. claimed that the learned Assessing Officer ignored the evidence furnished by the assessee during the course of assessment proceedings. He drawn our attention on paper book and claimed that in number of cases, supporting evidence in form of producing the persons, furnishing the reply, furnishing the copy of account were submitted to the learned Assessing Officer. Some persons admitted lesser amount of commission receipt because they do not remember exact amount of commission. They admitted commission receipt on approximation. Therefore, it is submitted that entire commission claimed by the assessee may please be allowed U/s 37 of the Act. 6. At the outset, the learned D.R. supported the order of the learned CIT(A). 7. We have heard the rival contentions of both the parties and perused the material available on the record. The assessee started first year of his business in mobile service/telephone. He did not have any exp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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