Case Law Details
Batra Enterprises Vs ACIT (ITAT Delhi)
The facts relating to the ground are that during the course of assessment proceedings the Assessing Officer noticed that the assessee had made payment of Rs. 2,74,846/- being commission paid to Shri Ishan Batra. In response to the query of the Assessing Officer, the assessee had stated that Shri Ishan Batra was given commission at 0.5% of sales made by him. The Assessing Officer called upon the assessee to furnish any written agreement in this regard. It was stated before the Assessing Officer that there was no such written agreement. The commission was paid purely on the basis of oral agreement. The Assessing Officer did not accept this explanation of the assessee and disallowed the commission expenditure. On appeal to the learned CIT(A), same was confirmed.
Learned counsel for the assessee submitted that the authorities below were not justified in disallowing the claim merely on the basis that there was no written agreement. Learned counsel submitted that the commission was paid for making sales and there was no reason to make a false claim as the payment made to Shri Ishan Batra was also attracted tax at the highest slab. He submitted that it is not a case of evading tax.
The Tribunal find that the Revenue has not brought any material rebutting the claim of the assessee that the amount was paid as a commission. Undisputedly the Assessing Officer has not summoned Shri Ishan Batra for confronting him regarding payment of commission. Therefore, in the absence of any independent inquiry by the Assessing Officer on this issue, the addition so made cannot be sustained.
FULL TEXT OF THE ORDER OF ITAT DELHI
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