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TMI Blog2015 (10) TMI 736X X X X Extracts X X X X X X X X Extracts X X X X ..... - Held that:- We find that the genuineness of the claim has been verified by the AO in course of the remand proceedings. We further find from the facts of the case that the assessee has entered into agreement with the commission agents, and, the commission paid as per the terms of the agreement. We find from records that the assessee has filed complete details before the AO. The payments were made through banking channel, and, tax was also deducted at source. The books of accounts, bank statements, and, other relevant documents were produced, and, the AO has not found any defects in such books or documents. We find that in immediately preceding assessment year, the AO in the remand report, the AO has admitted that the nature of services rendered has been mentioned in the agreement, and, the commission agents have also confirmed rendering of services to justify the claim of commission. On the other hand, there is no material on record to show anything that could cast suspicion or doubt about the genuineness of the claim. In view of the above, there is no basis or justification for the disallowance made by the AO and CIT(A) has rightly deleted the disallowance made by AO. - Decided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [iii] Investment:- Investment as on 01.04.2008 Rs.2,09,93,107 Investment as on 31.03.2009 Rs.1,53,36,949 Rs.3,63,30,056 Average value of investment % of average value of investment = Rs.1,81,65,028 % of ₹ 1,81,65,028 ₹ 90,825 Expenses disallowable u/s 14A Rs.14,88,522 applying Rule 8D Rs.14,88,522 Aggrieved, assessee preferred appeal before CIT(A), who after considering the submissions of the assessee restricted the disallowance at ₹ 1,46,773/- by observing as under:- I have considered the observations of the Assessing Office in the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s expenditure as Placement Fee on Mutual Fund of ₹ 50,000/-; expenses on share transactions of ₹ 1,798 and Interest Paid on Mutual Fund of ₹ 4,150 and thereby totalling to ₹ 55,948/-. The appellant has claimed these expenses in the Profit and Loss Account and has not disallowed on the basis that the said investments have not yielded any income during the assessment year 2009-10. The plea of the appellant is not tenable since it is not a rule whether any investment yield an income or not but the expenses incurred on investments which may even yield exempted income in future is to be disallowed, if debited in the profit and loss account. This is a direct expenditure incurred by the appellant on the investments yielding exempted income. However, during the appellate proceedings on 12-10.2010, Shri Pawan Agarwal, Aurhorised Representative of the appellant stated on the order sheet I have no objection if disallowance of ₹ 1,46,773/- is retained u/s. 14A in this case, being direct expenditure of ₹ 55,948/- and 0.50% of average investments for ₹ 90,825/-.' The plea of the Authorised Representative is found to be fair, reasonable and as per th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Directors i.e. Mr Dinesh Jalan of the appellant is a partner. The appellant has submitted that in the case of Sunrise Trading Company the addition has been deleted by the Ld. C.I.T.(Appeals)-XX, Kolkata vide its order No. 175/CIT(A)-XX/Wd-36(2)/09- 10/Kol. Dated 26th November, 2010 by observing as under:- I have perused the assessment order and the remand report of the AO. I have also considered the submissions of the appellant. The AO disallowed the claim of commission on the ground that no services were rendered by the commission agents, and, that the payments made to them were otherwise than for the purpose of business. However, the genuineness of the claim has been verified by the AO in course of the remand proceedings. The appellant has entered into agreement with the commission agents, and, the commission paid as per the terms of the agreement. Copy of bills raised by the commission agents was produced before the AO. The payments were made through banking channel, and, tax was also deducted at source. The books of accounts, bank statements, and, other relevant documents were produced, and, the AO has not found any defects in such books or documents. In the remand repor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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