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TMI Blog2018 (5) TMI 2092X X X X Extracts X X X X X X X X Extracts X X X X ..... y from the assessee company M/s. Nova Controls Pvt. Ltd. which is the flag ship company. As find from the details that similar commission has been paid to M/s. Toshbro Controls Pvt. Ltd., during the Financial Years 2007-08 to 2014-15 and the percentage of total sales made through the M/s. Toshbro Controls Pvt. Ltd. by the assessee ranges from 58.30% to 78.78% and the commission paid ranges between 11.57% and 18.83% depending upon the percentage of sales to total sales. We find that that the Revenue has accepted the payment of commission in all the earlier years and disallowance was made only during this year and based on an apprehension that the sister concern is making loss and therefore assessee tried to shift the profits, this fact is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ultancy filed return of income on 29.09.2012 declaring income of ₹.14,58,590/-. The assessment was completed u/s. 143(3) of the Act on 26.03.2015 determining the income at ₹.1,33,93,600/-. While completing the assessment the Assessing Officer disallowed ₹.1,11,84,279/- out of commission expenses incurred by the assessee. In the course of the assessment, Assessing Officer noticed that assessee paid commission to related party namely M/s. Toshbro Controls Pvt. Ltd. and stated to have been paid for the total business generated to the assessee by M/s. Toshbro Controls Pvt. Ltd. by way of sales. Assessing Officer also noticed that assessee deducted TDS @10% of such commission since it is related party. Assessing Officer with a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsel for the assessee strongly supported the orders of the Ld.CIT(A). Further the Ld. Counsel for the assessee referring to Page No. 31 of the Paper Book, submitted that similar disallowance of commission to sister concern was deleted by the Ld.CIT(A). Ld. Counsel for the assessee further referring to the details of sales commission to M/s. Toshbro Controls Pvt. Ltd. and breakup of the sales submitted that during the Financial Year 2011-12 relevant to the Assessment Year 2012-13 the percentage of total sales made through the sister concern M/s. Toshbro Controls Pvt. Ltd., is 58.30% and the percentage of total sales made directly by the assessee is 32.47%. Referring to the said chart, it is further submitted that the percentage of commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany and therefore the customer might have stated that they have got materials directly from the assessee company M/s. Nova Controls Pvt. Ltd. which is the flag ship company. 6. We further find from the details that similar commission has been paid to M/s. Toshbro Controls Pvt. Ltd., during the Financial Years 2007-08 to 2014-15 and the percentage of total sales made through the M/s. Toshbro Controls Pvt. Ltd. by the assessee ranges from 58.30% to 78.78% and the commission paid ranges between 11.57% and 18.83% depending upon the percentage of sales to total sales. We find that that the Revenue has accepted the payment of commission in all the earlier years and disallowance was made only during this year and based on an apprehension that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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