Commission cannot be disallowed merely for increase in Rate of Commission 

Srinathji Yamunaji Enterprises Vs ITO (ITAT Mumbai)

Introduction: In a recent case before the Income Tax Appellate Tribunal (ITAT) Mumbai, the issue of disallowance of excessive commission paid by Srinathji Yamunaji Enterprises was brought into question. The tribunal ultimately overturned the decision, highlighting the lack of evidence and business necessity.

The Hon’ble ITAT, Mumbai allowed the appeal and set aside the demand. It held:

(i) there is no allegation that the commission agent (foreign party) is related or the commission paid is bogus or the exports are not genuine, then such expenditure cannot be disallowed;

(ii) there is no contrary evidence placed on record by the Revenue;

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