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TMI Blog2022 (6) TMI 889X X X X Extracts X X X X X X X X Extracts X X X X ..... ng. When the address of the parties is before the Assessing Officer and it is not the case that the parties are bogus, the Assessing Officer cannot insist that assessee should produce these parties and otherwise Assessing Officer shall take adverse inference. The emphasis of the Revenue authorities in providing e-mail and correspondence is also un-called for. As per the rate of commission noted it is very small amount and by no stretch of imagination can be said to be exorbitant. When the commission paid is of a normal amount, the names and address of the parties have been duly mentioned, the persons who have appeared have also acknowledged the receipt of commission, then the disallowance is solely based upon surmises and conjectures. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cts and circumstances of the case and in law, the Ld. Commissioner of Income Tax (Appeal) is not justified in sustaining the disallowance of commission amounting to Rs.53,08,610/- paid to staff and others. 3. Brief facts of the case are that assessee in this case is engaged in the business of distribution in wholesale of machine tools of various types. The Assessing Officer examined the details of commission expenditure of Rs.53,08,610/- debited to profit and loss account. The Assessing Officer asked the assessee to furnish copies of the agreements with the parties with terms and conditions and details with evidences of services provided and also the TDS deducted. The Assessing Officer noted that assessee provided the details with na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessing Officer s order reads as under:- 5.3 The reply filed by the counsel for the assessee in regard to commission expenses has been examined but is found without merit. Even if, the commission expenses were incurred on referral basis for procuring orders, the assessee must have been in a position to furnish relevant documents or other evidences to prove that the said persons were involved for procuring business to the assessee. No evidence has been furnished in respect of genuineness of commission expenses and providing of any services in this matter, in respect of any of the parties. The parties whose statements were recorded u/s 131 also do not establish their role in providing of services for procurement of orders. Many of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of income and for filing in accurate particulars of taxable income. 4. Upon assessee s appeal the ld. CIT (Appeals) noted that Assessing Officer s observation regarding e-mail or correspondence with regard to services provided being not there. The ld. CIT (Appeals) also rejected the assessee s appeal that similar commission was earlier allowed on the ground that res judicata would not apply. He also held that there was no legal duty to summon parties to whom commission has been paid. The ld. CIT (Appeals) proceeded to confirm the entire claim of commission amounting to Rs.53,08,610/-. Against this order, the assessee is in appeal before us. 5. We have heard the ld. DR and perused the records. None appeared on behalf of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hasis of the Revenue authorities in providing e-mail and correspondence is also un-called for. As per the rate of commission noted it is very small amount and by no stretch of imagination can be said to be exorbitant. In our considered opinion when the commission paid is of a normal amount, the names and address of the parties have been duly mentioned, the persons who have appeared have also acknowledged the receipt of commission, then the disallowance is solely based upon surmises and conjectures. No law provides that commission expense will be allowed only if there is written agreement. The insistence of the Assessing Officer for the assessee to produce the party is also un-called for. No case has been made that the percentage of expendit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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