9911796707
TMI Blog2019 (10) TMI 463X X X X Extracts X X X X X X X X Extracts X X X X ..... e AO as well as failed to produce attendance register and the receipts given by the employees against payment of salary. The Ld. CIT(A) has already given sufficient benefit to the assessee. The assessee has parted with the substantial gross commission to others and has earned net profit at a meager figure. The assessee could not justify fall in the profit rate in assessment year under appeal to the satisfaction of the authorities below. No prudent person who has earned commission in crore would pay such an amount to others to earn only ₹ 8.78 lakhs. The history of the assessee noted above clearly show that assessee failed to produce any documentary evidences before the authorities below to justify the commission payable and sala ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e net profit shown by the assessee as compared to the previous assessment year. The AO noted that in this line of business net profit increases with increase in turnover, since basic establishment expenses have to be incurred even if there is low turnover. From perusal of the profit and loss account, it was found that assessee has claimed very high commission expenses and salary expenses to the tune of ₹ 63,52,632/- and ₹ 51,71,448/- respectively. The commission payable at the end of the year was of ₹ 18 lakhs. The AO asked the assessee to file complete details of the persons to whom commission has been paid along with their ITR, computation of income, confirmation and details of client and work against which the commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vealed that TDS has not been paid on time. The AO after considering explanation of assessee noted that commission expenses has been booked on 31.03.2014 and have bee shown payable only at the fag end of the next financial year. The perusal of the addresses shows most of them belong to the same family and in some of the cases interest has been paid instead of commission. The assessee did not produce any commission agreement etc. despite giving opportunity. The assessee failed to discharge onus to prove commission payable shown outstanding as liability in the balance sheet and also failed to produce any of such persons for examination. TDS is also not paid in time. The AO, accordingly, disallowed the commission payable to the extent of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... found to be payable as on 31.03.2014. In respect of commission documents furnished by the appellant during assessment proceedings as well as during appellate proceedings did not prove the services rendered by seven persons. Merely the deduction of TDS does not justify that expenditure has not incurred wholly and exclusively for business purpose. Similarly in the case of salary appellant failed to furnish details of employees, their complete address and their assessment particulars by specific document such as attendance register or receipts. Besides that AO noted that considerable part of salary was made in cash. However, the estimate of disallowance of 30% of unverifiable expenses on account of salary of ₹ 51,71,448/- is found to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... commission was shown payable at the end of the year. The assessee failed to produce any evidence as to what services those commission agents have rendered for the business of the assessee. The amounts have been paid to them subsequently. These persons are related persons with the assessee and even one of the person is the husband of assessee. Since the assessee failed to produce relevant evidences and also failed to produce such persons for examination before the AO, therefore, the onus upon assessee to prove genuine commission was payable have not been discharged by the assessee. Merely because assessee dedycted TDS would not justified that expenses have been incurred wholly and exclusively for the purpose of business. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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