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TMI Blog2021 (9) TMI 953X X X X Extracts X X X X X X X X Extracts X X X X ..... on the presumption and assumption that something new may come out. - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... ies and perused the material available on record. 9. From the records, we find, a. With regard to China Tax- The assessee has replied vide letter dated 18.08.2017. China Tax is paid by the Chinese manufacturers which is deducted from the commission paid to the assessee. The gross commission is credited and the Chinese Tax paid by the manufacturer is debited. b. With regard to commission- It was explained before the AO that the commission has been paid to various persons namely, Sh. Rajesh Jain, Sh. Rajat Singhal, Sh. Vijayanat Jain, Ms. Roopa Malhotra for obtaining orders from different companies and for different products. The invoices issued by the agents have been submitted and TDS has been duly deducted. Vide letter dated 20.11.2017, copies of the agreements, contracts for receipt of commission from Chinese Companies were submitted before the AO. The details of the commission have been duly explained in detail vide reply dated 28.11.2017 submitted before the AO. For the sake of ready reference, the reply given by the assessee to the AO is reproduced as under: "Sub.: Assessment Proceedings u/s. 143(2) and 142(1) of the Income Tax Act, 1961. Respected Sir, With re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cuments enclosed are enclosed as per Annexure 4. 3.7 The Chinese Supplier books the shipment of Product in favor of Indian Manufacturers Customers sends the original Bill of Lading along with shipment documents to Indian Customers Bank and sends the copy of same to Assessee LLP. The copy related documents are enclosed as per Annexure 5. 3.8 Upon the arrival of Goods in India, Indian Customers get the same cleared from Custom Authorities, employees of Assessee LLP coordinates with Clearing House Agent for clearance of any doubts as products are related to Pharma Industry. 3.9 Assessee LLP then issued Commission Note on Chinese Manufacturers that our Commission would be due within 90 days. Copy of Commission Note is enclosed as per Annexure 6. 3.10 On the Completion of 90 days the Invoice is raised on the Chinese Manufacturers Companies for Commission due. Copy of invoice is enclosed as per Annexure 7. 3.11 Thereafter the employees of Assessee LLP follow up for the payment of dues. The payment is received directly in Bank through banking channels i.e. Swift Transfer. Few Copies of Foreign Inward Remittance Certificate (FIRC) is enclosed as per Annexure 8. 4. Note on expen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the four agents, which your good-self specifically asked for are as under: 4.11.1 Rajan Jain is a graduate having 10 years of experience having PAN as AANPJ3470G and is associated with shah TC group since FY 2009-10. Customers for relevant products provided by him were Morepan Laboratories Ltd. and Sarca Laboratories Ltd. He is not a party u/s. 40A2(b) of the assessee LLP. Related documents of commission to him has already been submitted to your office as per para 4.4 above. 4.11.2 Rajat Singhal is a graduate having 10 years of experience having PAN as BCTPS6986B and is associated with shah TC group since FY 2014-15. Customer for relevant products provided by him was MSN Laboratories Ltd. He is not a party u/s. 40A2(b) of the assessee LLP. Related documents of commission to him has already been submitted to your office as per para 4.4 above. 4.11.3. Vijayant Jain is a graduate having 10 years of experience having PAN as AANPJ3471H and is associated with shah TC group since FY 2009-10. Customers for relevant products provided by him were Hetero Labs Ltd., C J Shah & Co. and Kantilal Manilal & Co. Pvt. Ltd. He is not a party u/s. 40A2(b) of the assessee LLP. Related documents o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of revenue. In case of Malabar Industrial Co. Ltd. Vs. CIT (2000) 243 ITR 87 (SC) Hon'ble Apex Court held that there was no material to support the claim of appellant & yet AO accepted the entry in the statement of account in absence of any supporting material and without making any inquiry. It is incumbent on the officer to investigate the facts stated in the return. The order becomes erroneous if such as enquiry has not been made as held in case of Duggal & Co. Vs. CIT (1998) 220 ITR 458 (Del.). 13.1 Where the Assessing Officer keeps a letter on record and does not carry out necessary investigations which are per se required to verify the correctness of the averments, there being an error in the sense that he has failed to carry out the requisite enquiry which can be rectified in a revision. Thus the Commissioner was to pass a fresh order under Section 283 after hearing the assesses [CIT vs. DLF Power Ltd., (2012) 345 ITR 448(Del.)]. 13.2 The Hon'ble Delhi High court in the case of CIT Vs. Shri Braham Dev Gupta in ITA No. 907/2017 and 1162/2017 has clearly decided that Pr. Commissioner of Income Tax can invoke the provision of section 263 of income Tax Act where AO ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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