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TMI Blog2022 (4) TMI 1010X X X X Extracts X X X X X X X X Extracts X X X X ..... ls of TDS deducted on payments of such commissions. No separate and independent investigation was carried out by the AO. So far as objections ld. DR for revenue that assessee failed to prove the services rendered by commission recipient, in our view those facts may be relevant for allowing/disallowing the commission payment, however, same is not relevant as far as levy of penalty under section 271(1)(c) is concerned. As in CIT vs. Reliance Petroproducts (P) Ltd.[ 2010 (3) TMI 80 - SUPREME COURT ] held that mere filing in incorrect claim which is not acceptable to AO would not lead to levy of penalty. Thus, in view of the above discussions, the grounds of appeal raised by the assessee is allowed. - ITA No. 133/SRT/2019 - - - Dated:- 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenses of ₹ 7,34,054/-.3. Aggrieved by the additions in the assessment order, the assessee filed before ld. CIT(A) wherein the disallowance was deleted vide order dated 10.08.2007. On the appeal of revenue before Tribunal, the order of Ld. CIT(A) was reverse in order dated 11.10.2010 in ITA No. 4095/Ahd/2007. And the appeal was restored the matter back to the ld. CIT(A) for deciding issue afresh to decide with the finding as to whether or not the commission agents had rendered services to the assessee. In setting aside proceedings, the ld. CIT(A) confirmed/disallowance of commissions expenses in order dated 30.03.2017. On further appeal before the Tribunal, the addition was upheld in ITA No. 1176/AHD/2014 dated 06.04.2017. 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, as compared to previous year was higher 87%. The turnover of assessee was also increased by 10.25% as compared to previous year. The Assessing Officer never asked to establish services rendered by commission recipient. The ground of disallowance is wrong. The commission is paid for raising the sales. Every payment of commission does not always mean that the sales will rise in same proportion. Rise in sales depends on many factors such as Goodwill of the supplier, market conditions etc. There rise in sales due to payment of commission in the year of payment of commission may differ from industry to industry and customer to customer. Sometime, commission paid in current year yield result in next year also. There is no set parameters for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der of lower authorities. The ld. AR of the assessee submits that during the relevant financial year, the assessee paid commission to eight parties. The assessee deducted tax at source (TDS) at the time of making payment. During the assessment proceedings, the assessee furnished complete details of the parties from including name of parties, PAN, amount of commission paid, TDS amount and @ TDS. The assessee furnished the confirmation of parties, the Assessing Officer not made any independent investigation from the parties. The Assessing Officer disallowed only on the ground that commission paid during the year is raised to the extent of 87% compare to preceding year. In the preceding year, the assessee paid commission of ₹ 3,91,865/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of the expenses claimed, would not lead to levy of penalty. 9. The ld. AR submits that the Hon'ble Supreme Court in CIT vs. Reliance Petroproducts (P) Ltd. (supra) held that mere filing in incorrect claim which is not acceptable to Assessing Officer would not lead to levy of penalty. Further, AR for the assessee reiterated that the Assessing Officer has not disputed the payment of commission nor brought any evidence on record that commission was not paid to the parties. 10. On the other hand, ld. Sr DR for the revenue DR submits that during the assessment proceedings, the Assessing Officer find that in the earlier year, the assessee paid commission of ₹ 3,91,865/- and there was the rapid rise to extent of 87% in commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... round of appeal before ld. CIT(A), the addition was upheld, which was ultimately confirmed by Tribunal in his order dated 06.04.2017 in ITA No. 1176/AHd/2014. 13. Before us, the ld. AR of the assessee vehemently argued with commission payment is not disputed and that no evidence was brought by Assessing Officer on record that commission payment was not genuine. The basis of disallowance was only that it was 87% higher than the commission paid in earlier years. 14. It is settled law that penalty proceedings under section 271(1)(c) of the Act is separate and independent. We are conscious of facts that in the quantum assessment, the addition has been upheld up to the stage of Tribunal. However, facts remained the same that initial b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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