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TMI Blog2015 (8) TMI 1493X X X X Extracts X X X X X X X X Extracts X X X X ..... ddition made by AO on account of disallowance of Rs. 8,41,536/- made by AO being payment of commission. For this assessee has raised the following ground no.1 :- "1. For that the ld. CIT(A) ought to have properly appreciated the facts and the evidences on record and ought not to have confirmed the disallowance of Rs. 8,41,536/- made by the AO being payment of commission which was duly supported by evidences." 3. Briefly stated facts are that AO noticed that the assessee is a proprietor of M/s. Mahavir International in which he is doing trading business of stamping foils. During the F.Yr. ending 31.3.2007 the assessee has made a turnover of Rs. 2.06 crores and had paid commission of Rs. 8,41,537/- after deducting tax at source of Rs. 42 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reference to various judicial pronouncements which read as under :- I) CIT vs Precision Finance (P)Ltd [1994] 208 ITR 465 (Cal) II) Sumati Dayal vs CIT [1995] 214 ITR 801 (SC) III) CIT vs United Commercial and Industrial Co.(P)Ltd [1991] 187 ITR 596 (Cal) IV) DP More 82 ITR 540 (SC) V) Smt. Vasantibai N.Shah vs. CIT [1995] 213 ITR 805 (Bom) In view of the above AO came to a conclusion that it is clear that an amount of Rs. 8,41,536/- shown by the assessee as alleged commission is bogus and added back to the total income of the assessee. Now aggrieved the assessee went in appeal before CIT(A). The CIT(A) in his order stated that "4.2. I have perused the assessment order and considered the submission of the appellant. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the principle. AO has called the director of the company only to record his statement by giving him notice u/s 131 of the Act. It is quite possible that the company has various types of activities and working as commission agent is also a part and such companies work for many types of clients. Quite possible a director might not be aware of names and details of all the clients of the company. The AO should have enquired through the sales man of the commission agent or through the buyers of the products of the assessee in order to verify the actual commission given to M/s.Wide Angle Packaging System (P)Ltd for doing the sales on behalf of the assessee against commission. The assessee has paid commission by account payee cheque. Due TDS pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he AO.
Aggrieved, now the assessee preferred appeal before this Tribunal.
7. The ld. DR relied upon the orders of the authorities below.
8. I have heard the rival submissions and gone through the facts and circumstances of the case. Looking into the nature of the expenses in which there is always a possibility to inflate the expenditure as well as expenses to some extent incurred for personal purposes also. The CIT(A) has also restricted the disallowance from 15% to 10% in the interest of justice and as such I find no infirmity in the order of the CIT(A). Thus this ground of appeal is dismissed.
9. In the result the appeal of the assessee is partly allowed.
Order pronounced in the court. X X X X Extracts X X X X X X X X Extracts X X X X
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