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TMI Blog2017 (4) TMI 1584X X X X Extracts X X X X X X X X Extracts X X X X ..... Appeals) has erred in law and facts in upholding disallowance of commission expenses amounting to Rs. 7,34,054/- u/s 37(1) of the Income Tax Act, 1961." 3. In this case, return of income declaring total income of Rs. 23,42,830/- was filed on 31st October, 2004. Subsequently, the case was selected under scrutiny by issuing of notice u/s. 143(2) of the act. During the course of assessment proceedings, the assessing officer noticed that assessee has paid an amount of Rs. 7,34,054/- as sales commission to various persons including Rs. 91,133 given to a relative Mahur D. Nayak. During the course of assessment proceedings, the assessing officer stated that the sale of the assessee increased by merely 10.25% whereas the sale commission has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowance of deduction of commission. Now the submissions and details filed by appellant are to be examined in the light of aforesaid observations and directions of Hon'ble ITAT. In support of its claim, appellant filed the copies of ledger, copy of own bank statements and confirmation of some of the parties. In the ledger accounts, entries of payments have been made by appellant whereas in its own bank statement, the names of recipient parties have been written in someone's hand writing. However, confirmations of parties have been submitted. In view of these details, it can be concluded that the payments have actually made by appellant to aforesaid parties. However, in respect of the second condition, it can be concluded on the bas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on record. We noticed that in this case the Co-ordinate Bench of ITAT vide ITA No. 4095/Ahd/2007 had restored this matter to the CIT(A) for deciding the issue afresh by observing as under:- "6. We have heard the Id. DR and gone through the facts of the case. We find that the assessee did not file confirmation of the parties to whom the commission had been paid except in the case of Shri Mehul D Naik nor submitted any evidence of services rendered by any of the recipient of commission. Even then, the CIT(A) concluded that the expenditure having been incurred wholly and exclusively for the purpose of business, is allowable. In order that payments made as commission to persons appointed as selling agents are allowable as deduction, the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t opportunity to both the parties. Needless to say that while re-deciding the issue, the learned CIT(A) shall pass a speaking order, keeping in mind, inter alia, the mandate of provisions of sec. 25O(6) of the Act, bringing out clearly the nature of services rendered by each of the recipient of commission. With these observations, ground no. 1 in the appeal is disposed of." We have gone through the material on record and paper book through the assistance of the representatives. We have noticed that the case of the assessee was set aside by the ITAT as supra because the assessee had not furnished any evidence of services rendered by agents, to whom commission had been paid. The ITAT Coordinate Bench vide order supra had directed the learne ..... X X X X Extracts X X X X X X X X Extracts X X X X
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