M/s. Madhu Industries Pvt. Ltd., Ahmedabad V. ITO, Ward-2(1)(4), Ahmedabad

ITA 130/AHD/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 4604 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 10 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 03-10-2019
• Assessment Year: 2013-2014
• Appeal Filed On: 11-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N G GOEL
• Section: 195; 201; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD SMC BENCH BEFORE: SHR I RAJPAL YADAV , JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER M/S. MADHU INDUSTRIES PVT. LTD. 39, PHASE - II, GIDC, VATVA, AHMEDABAD PAN: AAFCM2587A (APPELLANT) VS THE ITO, WARD - 2(1)(4), AHMEDABAD (RESPONDENT) REVENUE BY : S H RI N.G. GOEL , SR. D . R. AS SESSEE BY: SHRI SUNIL TALATI , A.R. DATE OF HEARING : 03 - 10 - 2 019 DATE OF PRONOUNCEMENT : 14 - 11 - 2 019 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT MEMBER : - THIS ASSESSEE S APPEAL FOR A.Y. 2013 - 14 , ARI SES FROM ORDER OF THE CIT(A) - 2, AHMEDABAD DATED 01 - 12 - 2 017 , IN PROCEEDINGS UNDER SECTION 1 4 3(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. THE ASSESSEE HAS CONTESTED IN ITS TWO GROUNDS OF APPEAL THE CONFIRMING OF DISALLOWAN CE OF COMMISSION AND VIOLATION OF PROVISION OF RULE 37BB OF THE I.T. RULES. BOTH THE GROUNDS OF APPEAL OF THE ASSESSEE ARE INTER - CONNECTED TO THE ISSUE OF DISALLOWANCE OF RS. 27 , 79 , 795/ - OF FOREIGN COMMISSION OUT OF TOTAL COMMISSION OF RS. 51 , 47 , 620/ - PAI D TO THE NON - I T A NO . 130 / A HD/20 18 A SS ESSMENT YEAR 2013 - 14 I.T.A NO. 1 3 0 /AHD/20 18 A.Y. 2013 - 14 PAGE NO MADHU INDUSTRIES PVT. LTD. VS. IT O 2 RESIDENT AGENTS FOR EXPORT OF GOODS OF THE ASSESSEE. T HEREFORE, FOR TH E SAKE OF CONVENIENCE, THESE GROUNDS OF APPEAL ARE ADJUDICATED TOGETHER. 3. THE FACT IN BRIEF IS THAT ASSESSE HAS FILED RETURN OF INCOME ON 28 TH NOV, 2013 DECLARING TOTA L INCOME AT RS. 11 , 18 , 516/ - . THE CASE WAS SELECTED FOR SCRUTINY BY ISSUING OF NOTICE U/S. 143(2) OF THE ACT ON 4 TH SEP, 2014. DURING THE COURSE OF ASSES SMENT, THE ASSESSING OFFICER NOTICED THAT ASSESSEE HAS DEBITED EXPORT COMMISSION OF RS. 51 , 47 , 620/ - TO THE NON - RESIDENT FOREIGN AGENT S AND ASKED THE ASSESSEE TO FURNISH THE DETAIL OF EXPORT COMMISSION PAYMENT WITH EVIDENCES OF SERVICES RENDERED BY THOSE FOREIGN AGENTS. THE ASSESSEE HAS FURNISHED THE DETAIL VIDE LETTER DATED 12 TH MARCH, 2016 AS ELABORATED AT PAGE NO. 2 & 3 OF THE ASSESSING OFFICER S ORDER. THE ASSESSING OFFICER WAS NOT AGREED WITH THE DETAIL FURNISHED BY THE ASSESSEE IN RESPECT O F COMMISSION PAID TO THE THIRD PARTY NAMED CALMONTE AND HELD THAT THE ASSESSEE HAS NOT PROVED THE GENUINENESS OF COMMISSION PAYMENT OF RS. 27 , 79 , 795/ - OUT OF TOTAL COMMISSION EXPENSES OF R S. 51 , 47 , 620/ - , THEREFORE, THE COMMISSION EXPENSES OF RS. 27 , 79 , 795/ - WAS DISALLOWED AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 4. THE ASSESSEE HAS FILED APPEAL BEFORE THE L D. CIT(A). T HE LD. CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE STATING THAT ASSESSEE HAS NOT SUBMITTED COPY OF AGREEMENT AND OTHER DOCUMENTS TO ESTABLISH GENUINENESS OF FOREIGN COMMISSION IN RESPECT OF COMMISSION PAYMENT TO M/S. CALMONTE. 5. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE US, THE LD. COUNSEL HAS CONTENDED THAT ALL THE SUPPORTING DETAIL PERTAINING TO THE COMMISSION I.T.A NO. 1 3 0 /AHD/20 18 A.Y. 2013 - 14 PAGE NO MADHU INDUSTRIES PVT. LTD. VS. IT O 3 PAYMENT I.E. LEDGER COPY OF FOREIGN COMMISSION PAID, COPY OF CONFIRMAT ION LETTER, COPY OF FORM NO. 15CB, COPY OF SALE INVOICES, FORM AND APPLICATION FOR REMITTANCES U/S. 195 ETC. WERE FILED BEFORE THE ASSESSING OFFICER AND LD. CIT(A) DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND SAME WERE NOT CONTRADICTED BY THE LOWER AUTHORITIES. THE LD. COUNSEL HAS ALSO SUBMITTED A PAPER BOOK CONTAINING DETAIL AND SUBMISSION FILED BY THE ASSESSEE DURING THE COURSE ASSESSMENT AND APPELLATE PROCEEDINGS BEFORE THE LOWER AUTHORITIES. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATIVE HAS SUPPORTED THE ORDER OF LD. CIT(A). 6 . WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MATERIAL ON RECORD CARE FULLY. OUT OF THE EXPORT COMMISSION OF RS. 51 , 47 ,620/ - P AID TO NON - RESIDENT FOREIGN AGENTS DURIN G THE YEAR UNDER CONSIDERATION, T HE ASSESSING OFFICER HAS DISALLOWED THE COMMISSION EXPENSES OF RS . 27 , 79 , 795/ - ON THE GROUND THAT ASSESSEE HAS FAILED TO FURNISH THE SUPPORTING DETAIL AND EVIDENCES. IN THIS REGARD, THE ASSESSEE HAS DEMONSTRATED FROM THE PAPER BOOK THAT DIFFERENT DETAIL LIKE LEDGER, COPY OF FOREIGN COMMISSION, COPY OF INTIMATION LETTER OF THE FOREIGN AGENT, COPY OF REQUEST LETTER OF THE ASSESSEE TO ITS BANK MANAGER TO MAKE FOREIGN PAYMENT, COPY OF FORM NO. 15CB, COPY OF INTIMATION LETTER OF THE BANK AUTHORITY AND COPY OF SA LE INVOICES ETC. WERE FILED BEFORE THE LOWER AUTHORITIES . CONSID ERING ABOVE FACT S AND CIRCUMSTANCES, WE OBSERVE THAT ASSESSING OFFICER HAS NOT SPECIFICALLY CONTRADICTED THE DETAIL S AND EVIDENCES FILED BY THE ASSESSEE, THEREFORE, WE ARE OF THE VIEW THAT IT WILL BE APPROPRIATE TO RESTORE THIS CASE TO THE FILE OF ASSESSIN G OFFICER FOR DECIDING THE MATTER AFRESH AFTER VERIFICATION AND I.T.A NO. 1 3 0 /AHD/20 18 A.Y. 2013 - 14 PAGE NO MADHU INDUSTRIES PVT. LTD. VS. IT O 4 EXAMINATION OF THE DETAIL S FILED BY THE ASSESSEE. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 7 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR S TATISTICAL PURPOSE. ORDER PR ONOUNCED IN THE OPEN C OURT ON 14 - 1 1 - 201 9 SD/ - SD/ - ( RAJPAL YADAV ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 14 /1 1 /2019 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,