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TMI Blog2024 (3) TMI 304X X X X Extracts X X X X X X X X Extracts X X X X ..... mply on the basis of solitary statement of Sh. Ravinder Yadav without conducting any further enquiry, is not sufficient to accept the finding of the AO. CIT(A) has rightly deleted the addition in dispute - Ground No. 1 raised by the Revenue deleted. Disallowance u/s. 40(a)(ia) - interest payable and fit out charges received from buyers - CIT(A) deleted addition - HELD THAT:- CIT(A) observed that fit out charges received is part of the agreement signed with the customers who opted for fit out by the assessee. Therefore, simply on the basis of inadvertent mistake by the auditor by grouping certain liability in a different head in the balance sheet, cannot be the basis for sustaining the addition, therefore, in our considered opinion, the Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led the Appeal against the order of the Ld. CIT(A)-22, New Delhi relating to assessment year 2012-13 on the following grounds:- 1. Whether the Ld. CIT(A) has erred in allowing the appeal regarding disallowance of total commission paid on booking of space amounting to Rs. 1,23,87,897/-. 2. Whether, the Ld. CIT(A) has erred in allowing the appeal regarding disallowance u/s. 40(a)(ia) of the Income Tax Act of the interest payable and fit out charges received from buyers amounting to Rs. 4,69,31,575/-. 3. Whether the Ld. CIT(A) has erred in allowing the appeal regarding disallowance of amount paid towards assured return amounting to Rs. 29,31,312/-. 4. The appellant craves leave to add, amend, or reserving the right to amend, modify, add, or fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 97/- is concerned, AO observed that as per section 37 of the I.T. Act the assessee has to prove that the expenditure has been genuinely incurred and has been incurred wholly and exclusively for the purposes of the assessee s business, which has not been proved before the AO, hence, AO treated Rs. 1,23,87,897/- on account of commission as bogus and added the same to the income of the assessee, 5.2 As regards, Ground No. 2 relating to addition of Rs. 4,69,31,575/- is concerned, AO observed that assessee has not deducted tax at source on interest of Rs. 4,69,31,575/- as shown in the balance sheet and to conceal these facts, the assessee has taken different stand at different point of time in order to escape from true transaction and assessee i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndered. They had shown the commission income in their return of income filed for the relevant years. Commission was also paid in subsequent years which was accepted by the AO and in fact more commission paid in the subsequent year for which AO does not have any objection and the assessment was completed u/s. 143(3) of the Act. AO made enquiries from various persons by issuing notices u/s. 133(6) and obtained confirmations and documents without giving any basis of doing so, however in response to section 133(6) some of the buyers have stated that the space was booked through broker but did not pay brokerage to broker. Hence, Ld. CIT(A) observed that AO s conclusion that payment of commission to brokers bogus, is not correct appreciation of f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring in the balance sheet. The interest payable of Rs. 1,06,984/- was the amount of interest payable after deductions of TDS of Rs. 11,887/- which is clear from the TDS certificate submitted at page no. 91 of the paper book before the Ld. CIT(A). It is observed that the challan for deposit of TDs was on record before AO but the AO did not examine this. Therefore, the Ld. CIT(A) was right observing that TDS on interest payable of Rs. 1,06,984/- was deducted on deposited by the assessee, hence, he rightly deleted the disallowance of Rs. 1,06,984/- and regarding fit out charges, it is noted that relevant ledger account at the name of the person from whom fit out charges were received, have been submitted before AO. In the remand proceeding als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irmed to have received assured return. In view of above, Ld. CIT(A) has observed that AO is not correct in questioning the business necessity of the assessee for offering more assured return than the advertised through initial advertisement and relied upon the decision of the Hon ble Delhi High Court in the case of SA builders vs. CIT on 14.12.2016 wherein it has been held that once it is established that there was nexus between the expenditure and the purpose of the business, the Revenue cannot justifiably claim to put itself in the arm-chair of the businessman or in the position of the board of directors and assume the role of decide how much is reasonable expenditure having regard to the circumstances of the case. In view of above, in ou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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