ADDL CIT 5(2), MUMBAI V. INTERGOLD GEMS P. LTD, MUMBAI

ITA 1571/MUM/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 88287 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 11 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-02-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I
• Next Hearing Date: 21-01-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 23-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SACCHIDANAND DUBEY
• Assessee Lawyers: NITESH JOSHI P P BHANDARI
• Keywords: Proportionate interest
• Section: 143(3); 5(2); 131

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES I , MUMBAI . , , , BEFORE SHRI D KARUNAKARA RAO , A M AND SHRI AMIT SHUKLA , J M ITA NO. 1571 /MUM/201 1 : ASST.YEAR 200 7 - 200 8 THE ADDL .COMMISSIONER OF INCOME - TAX CIRCLE 5(2) MUMBAI. / VS. M/S.INTERGOLD GEMS PRIVATE LIMITED 58/60 JARIWALA MANSION N.S.PARMAR MARG, HUGES ROAD CHARNI ROAD, MUMBAI 400 007. PAN : AAACI1062K . ( / APPELLANT) ( / RESPONDENT) /APPELLANT BY : SHRI SACCHIDANAND DUBEY /RESPONDENT BY : S/ SHRI NITESH JOSHI / P.P.BHANDARI / DATE OF HEARING : 27.01.2015 / DATE OF PRONOUNCEMENT : 13 .02.2015. / O R D E R PER AMIT SHUKLA (JM) : THIS APPEAL HAS BEEN PREFERRED BY THE REVENUE AGAINST THE ORDER DATED 13.12.2010 , PASSED BY THE COMMISSIONER OF INCOME - TAX (APPEALS) - 9 , MUMBAI, FOR THE QUANTUM PROCEEDINGS U/S 143(3) FOR THE ASSESSMENT YEAR 2007 - 200 8 , ON THE FOLLOWING GROUNDS OF APPEAL . 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) HAS ERRED IN ALLOWING THE INTEREST EXPENSES ON ACCOUNT OF BORROWE D FUNDS UTILIZED IN REPAYMENT OF INTEREST FREE LOANS TAKEN FROM SISTER CONCERN AND WHETHER SUCH EXPENSES AMOUNTS TO INCURRING WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS . 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT (A) HAS ERRED IN ALLOWING REIMBURSEMENT OF EXPENSES TO SISTER CONCERNS AND OTHER PARTIES AMOUNTING TO RS.1,30,05,978/ - WITHOUT ITA NO. 1571 /MUM/201 1 . M/S.INTERGOLD GEMS PVT.LTD. 2 APPRECIATING THE FACT THAT THE ASSESSEE FAILED TO JUSTIFY THE SAME AS INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS , FURTHER WHETHER IT IS WITHIN THE JURISDICTION OF THE LD.CIT(A) IN DIRECTING THE ASSESSING OFFICER TO RECTIFY THE CORRECT AMOUNT OF REIMBURSEMENT 3. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) HAS ERRED IN ALLOWING THE COMMISSION EXPENSES PAID COVERED U/S 40A(2)(B) OF THE I.T.ACT IN THE ABSENCE OF ANY JUSTIFICATION FOR THE REASONABLENESS OF PAYMENTS MADE WITH REGARDS TO THE NATURE OF QUANTUM OF SERVICES RENDERED FOR WHICH SUCH COMMISSION WAS PAID. THE APPELLANT PRAYS T HAT THE ORDER OF THE LD.CIT(A) BE SET ASIDE AND THE ORDER OF THE A.O. BE RESTORED. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE - COMPANY IS A RETAILER OF DIAMOND STUDDED JEWELLERY OPERATING THROUGH CHAIN OF SHOWROOMS AND FRANCHISES ALL OVER THE COUNTRY. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE IS MAKING LARGE AMOUNT OF PAYMENTS TO ITS SISTER - CONCERNS IN THE FORM OF LOAN TRANSACTIONS. TO VERIFY , WHETHER THE INTEREST BEARING LOAN IS BEING DIVERTED TO SISTER - CONCERNS, THE ASSESSING OFFICER RAISED , A SPECIFIC QUERY, IN RESPONSE TO WHICH THE ASSESSEE SUBMITTED THAT IT HAS PAID INTEREST AGGREGATING TO RS.2,82,39,512 ON THE BORROWINGS FROM THE BANKS. THE SAID BORROWINGS WERE FOR SP ECIFIC PURPOSES I.E. TO MEET THE REQUIREMENT OF WORK - IN - CAPITAL. PHOTOCOPY OF THE SANCTION LETTER FROM THE BANK WAS ALSO SUBMITTED. THUS, IT WAS SUBMITTED THAT NO INTEREST BEARING FUNDS HAVE BEEN ADVANCED TO THE SISTER - CONCERNS FOR NON - BUSINESS PURPOSES. T HE ASSESSING OFFICER SOUGHT INFORMATION FROM THE BANKS (ING VYASYA BANK) BY ISSUANCE OF NOTICE U/S 131 , I N RESPONSE TO WHICH IT WAS INFORMED THAT THE ASSESSEE - COMPANY WAS REQUIRED TO MAINTAIN LEVEL OF USL AT INR 533.20 MIO AS AT 31 ST MARCH, 2007 BY WAY OF UNSECURED LOAN. MOST OF THE UNSECURED LOANS HAVE BEEN RECEIVED ITA NO. 1571 /MUM/201 1 . M/S.INTERGOLD GEMS PVT.LTD. 3 FROM M/S.ROSY BLUE INDIA PRIVATE LIMITED. DURING THE RELEVANT FINANCIAL YEAR THE ASSESSEE HAS MADE PAYMENT TO M/S.ROSY BLUE INDIA PRIVATE LIMITED AND THE BALANCE HAD GONE WELL BELOW THE LIMIT PRESCRIBED IN THE SANCTION LETTER. THE TOTAL AMOUNT OF UNSECURED LOAN TO BE MAINTAINED BY THE ASSESSEE AS PER THE SANCTION LETTER OF THE BANK WAS AT RS.82 CRORE. HOWEVER THE AVERAGE AMOUNT OF UNSECURED LOAN FROM THE SISTER - CONCERNS WAS ONLY RS.40 CRORE. TH US, HE CONCLUDED THAT THE INTEREST BEARING LOANS FROM THE BANK , WAS TAKEN FOR THE BUSINESS PURPOSES WHICH HAS BEEN USED FOR REPAYING NON - INTEREST BEARING LOANS FROM THE SISTER CONCERNS. THE ASSESSEE COULD NOT PROVE THAT THE INTEREST FREE FUNDS WERE ADVANCE D ONLY FROM AVAILABLE INTEREST FREE FUNDS OR FROM RESERVES AND SURPLUS. ACCORDINGLY HE WORKED OUT THE PROPORTION DISALLOWANCE OF INTEREST AT RS.1,39,00,578. 2.1 HE FURTHER NOTED THAT THE ASSESSEE HAS DEBITED REIMBURSEMENT OF EXPENSES INCURRED BY THE SIST ER - CONCERNS UNDER VARIOUS HEADS. IN ORDER TO SEEK CLARIFICATIONS , WHETHER TDS HAS BEEN DEDUCTED ON SUCH REIMBURSEMENT OF EXPENSES, THE ASSESSING OFFICER ISSUED A SHOW CAUSE NOTICE VIDE ORDER SHEET ENTRY DATED 16.12.2009 . I N RESPONSE TO WHICH, THE ASSESSEE SUBMITTED COPY OF BILLS IN RESPECT OF EXHIBITION EXPENSES REIMBURSED TO M/S.RUBY BLUE INDIA PVT. LTD. TOGETHER WITH THE DEBIT NOTE ISSUED BY THE SAID COMPANY. IT WAS STATED THAT, THE SAID EXPENSES WERE INCURRED TOWARDS `F OREVER PARTICIPATION FEE . THE ASSESSING OFFICER DISALLOWED THE SAID REIMBURSEMENT OF EXPENSES FOR A SUM AGGREGATING TO RS.1,30,05,978 ON THE GROUND THAT IT HAS NOT DEDUCTED TDS AND NO SATISFACTORY EXPLANATION HAS BEEN GIVEN . ITA NO. 1571 /MUM/201 1 . M/S.INTERGOLD GEMS PVT.LTD. 4 2.2 THAT APART, HE ALSO NOTED THAT THE ASSESSEE HAS M ADE PAYMENT TO CERTAIN PERSONS SPECIFIED U/S 40A(2)(B) IN THE FORM OF COMMISSION ON SALES TO THE FOLLOWING PERSONS: - (I) MR.VIJAY JAIN RS.32,70,683 (II) M/S.B.ARUNKUMAR & CO. (ASSOCIATE CONCERN) RS. 35,606 ------------------ RS.33,06,289 =========== THE A.O. NOTED THAT THE COMMISSION PAID TO SHRI VIJAY JAIN, WHO IS DIRECTOR AND CEO OF THE COMPANY, THE ASSESSEE COULD NOT GIVE PROP ER JUSTIFICATION WITH EVIDENCES. FURTHER THE ASSESSEE HAD INCURRED LOSSES IN THE CURRE NT YEAR AND ALSO IN THE EARLIER YEARS WHICH SUPPORTS THE FACT THAT THE PAYMENT OF COMMISSION IS NOT JUSTIFIED. FURTHER REGARDING OTHER PERSON ALSO, NO VALID EXPLANATION OR JUSTIFICATION WAS GIVEN BY THE ASSESSEE. ACCORDINGLY HE DISALLOWED THE SAID EXPENSES AGGREGATING TO RS.33,06,289. 3. BEFORE THE CIT(A), REGARDING THE DISALLOWANCE OF INTEREST, THE ASSESSEE SUBMITTED THAT THE A.O. HAS FAILED TO UNDERSTAND THE CORRECT FACTS OF THE CASE THAT IT HAS NOT GIVEN ANY INTEREST FREE LOAN TO ANY PERSONS INCLUDING ITS SISTER - CONCERNS. IN FACT IT HAS BORROWED SUBSTANTIAL INTEREST FREE FUNDS FROM THE SISTER - CONCERNS. THE SUMMARIZED POSITION OF INTEREST BEARING FUNDS AND INTEREST FREE FUNDS AS AT 31 ST MARCH, 2006 AND 31 ST MARCH, 2007 WERE GIVEN AS UNDER: - 2006 - 07 2005 - 06 (RS. IN LAKHS) ITA NO. 1571 /MUM/201 1 . M/S.INTERGOLD GEMS PVT.LTD. 5 --------------------------- INTEREST BEARING BORROWINGS FROM BANK 214.99 321.50 INTEREST FREE BORROWINGS 512.25 425.80 3 . 1 IT WAS SUBMITTED THAT THE ASSESSEE HAD RAISED INTEREST FREE FUNDS TO REDUCE THE BANK BORROWINGS. FURTHER THE A.O. WAS WRONG TO CONCLUDE THAT NO PROOF WAS FURNISHED AND NO NEXUS WAS ESTABLISHED IN THIS REGARD, IN FACT THE ASSESSEE HAD FURNISHED COMPLETE DETAILS AND ALSO THE FUND FLOW STATEMENT, WHICH WAS PART OF THE AUDITED ACCOUNTS OF THE COMPANY. THE QUANTUM OF UNSECURED LOAN SECURED WITH THE BANK WAS WITH REFERENCE TO THE SANCTION LIMIT OF RS.2,300 LAKH, WHEREAS THE ACTUAL BORROWINGS WAS ONLY TO RS.2 . 15 CRORE. IF THE BORR OWINGS FROM THE BANKS HAS BEEN UTILIZED FOR REPAYMENT OF LOAN EARLIER BORROWED AND USED FOR THE BUSINESS PURPOSES, THE N REPAYMENT THEREOF CANNOT BE CONSTRUED AS UTILIZED FOR NON - BUSINESS PURPOSES. 3. 2 THE LEARNED CIT(A), AFTER CONSIDERING THE ENTIRE FACT S AND SUBMISSIONS OF THE ASSESSEE, OBSERVED THAT THE A.OS FINDING IS NOT BASED ON CORRECT APPRECIATION OF FACTS. EVEN IF THE ASSESSEE HAS UTILIZED SOME OF THE INTEREST BEARING BORROWINGS TAKEN FROM THE BANK FOR REPAYMENT OF INTEREST FREE LOANS TAKEN FROM T HE SISTER CONCERNS FOR THE PURPOSE OF BUSINESS, THEN IT CANNOT BE HELD THAT THE ASSESSEE HAS DIVERTED THE INTEREST BEARING FUNDS FOR THE NON - BUSINESS PURPOSES. NO SUCH FACTS HAVE BEEN BROUGHT ON RECORD BY THE A.O. THAT THE ASSESSEE HAS DIVERTED ANY INTERES T BEARING FUNDS FOR NON - BUSINESS PURPOSES. ACCORDINGLY, HE DELETED THE SAID DISALLOWANCE OF INTEREST MADE BY THE A.O. ITA NO. 1571 /MUM/201 1 . M/S.INTERGOLD GEMS PVT.LTD. 6 3 . 3 REGARDING THE DISALLOWANCE OF REIMBURSEMENT OF EXPENSES, THE ASSESSEE SUBMITTED THAT THE ACTUAL REIMBURSEMENT WAS ONLY RS.8,25,000 T O M/S.RUBY BLUE INDIA PRIVATE LIMITED AND RS.69,689 TO M/S.INTER GOLD INDIA PRIVATE LIMITED , TOWARDS ADMINISTRATIVE EXPENSES INCURRED ON BEHALF OF THE ASSESSEE. IT WAS STATED THAT ALL THE DOCUMENTARY EVIDENCES IN THIS REGARD WERE SUBMITTED TO THE A.O. VIDE LETTERS DATED 21.12.2007 AND 29.12.2007. THE LEARNED A.O. HAS TAKEN THE LEDGER TOTALS OF M/S.JOSE JEWELS (I) PRIVATE LIMITED S ACCOUNT IN THE BOOKS OF M/S.RUBY BLUE INDIA PRIVATE LIMITED AND DISALLOWED THE SAME, WHICH HAS NO CONNECTION OR CO - RELATION WITH THE ASSESSEE OR HAS ANY RELEVANCE FOR THE PURPOSE OF DISALLOWANCE . 3 . 4 THE LEARNED CIT(A) AFTER CONSIDERING THE FACTS ON RECORD THOUGH UPHELD THE CONTENTION OF THE A.O. BUT HELD THAT THE A.O. HAS WRONGLY DISALLOWED RS.1,30,05,978 , WHEREAS THE CORREC T AMOUNT OF REIMBURSEMENT IS RS.8,94,689. HE THUS DIRECTED THE A.O. TO VERIFY THE CORRECT AMOUNT OF REIMBURSEMENT AND THE DISALLOWANCE SHOULD BE RESTRICTED TO THE ACTUAL REIMBURSEMENT. 3 . 5 REGARDING THE DISALLOWANCE OF COMMISSION PAID TO SHRI VIJAY JAIN, THE ASSESSEE CLARIFIED THAT THE COMMISSION PAID TO SHRI VIJAY JAIN WAS PART OF HIS REMUNERATION AND NO EXTRA MONEY HAS BEEN PAID. REGARDING COMMISSION PAID TO M/S.B.ARUNKUMAR & CO. OF RS.35,606, IT WAS SUBMITTED THAT SIMILAR DISALLOWANCE WAS MADE IN THE E ARLIER YEARS WHICH HAS BEEN DELETED BY THE CIT(A) AFTER DETAILED DISCUSSION AND NO FURTHER APPEAL HAS BEEN FILED BY THE DEPARTMENT. ITA NO. 1571 /MUM/201 1 . M/S.INTERGOLD GEMS PVT.LTD. 7 3.6 THE CIT(A), HELD THAT IN THE EARLIER YEARS THE THEN CIT(A) HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE AFTER NOTIN G THE FACT THAT THE COMMISSION TO SHRI VIJAY JAIN IS PART OF HIS REMUNERATION LOOKING TO THE SERVICES RENDERED AND DULY APPROVED BY THE BOARD RESOLUTION. T HE COMMISSION PAID IS ONLY PART OF THE SALARY PACKAGE AND THEREFORE , THE SAME CANNOT BE DISALLOWED. S IMILARLY REGARDING M/S.B.ARUNKUMAR & CO., THE CIT(A) IN THE EARLIER YEARS IT WAS HELD THAT COMMISSION HAS BEEN PAID AT THE RATE OF 0.75% OF THE SALES AFFECTED THROUGH THEM WHICH IS QUITE JUSTIFIED. THUS, RELYING UPON THE EARLIER ORDERS OF THE CIT(A) FOR TH E ASSESSMENT YEARS 2005 - 2006 AND 2006 - 2007, HE ALLOWED THE ASSESSEE S GROUND ON THIS SCORE. 4 . BEFORE US , THE LEARNED DEPARTMENTAL REPRESENTATIVE STRONGLY RELIED UPON THE ORDER OF THE ASSESSING OFFICER AND THE REASONING GIVEN BY HIM. HE SUBMITTED THAT TH E ONUS WAS UPON THE ASSESSEE TO SHOW DIRECT NEXUS OF THE UTILIZATION OF INTEREST BEARING BORROWED FUNDS FOR THE BUSINESS PURPOSES. THE DAY - TO - DAY CASH BALANCE HAS TO BE SHOWN AS TO WHETHER IT HAS NOT BEEN DIVERTED TO THE SISTER - CONCERNS WITHOUT CHARGING AN Y INTEREST. THEREFORE , THE A.O. HAS RIGHTLY DISALLOWED THE PROPORTIONATE INTEREST. REGARDING OTHER ISSUES ALSO, HE REFERRED TO THE FINDINGS GIVEN BY THE A.O. 5 . BEFORE US , THE LEARNED COUNSEL FOR THE ASSESSEE , SHRI NITESH JOSHI SUBMITTED THAT SO FAR AS T HE DISALLOWANCE OF INTEREST IS CONCERNED, IT IS EVIDENT FROM THE RECORD THAT INTEREST BEARING BORROWINGS FROM THE BANK HAVE REDUCED SUBSTANTIALLY AND THE INTEREST FREE BORROWINGS FROM THE SISTER - CONCERNS HAVE INCREASED. THEREFORE, THERE CANNOT BE ANY ALLEG ATION THAT INTEREST BEARING FUNDS HAVE BEEN DIVERTED TO THE SISTER - CONCERNS FOR NON - ITA NO. 1571 /MUM/201 1 . M/S.INTERGOLD GEMS PVT.LTD. 8 BUSINESS PURPOSES. FURTHER IT IS NOT A CASE OF DIVERSION OF FUNDS FOR NON - BUSINESS PURPOSES, BUT REPAYMENT OF LOAN TO THE SISTER - CONCERNS, WHICH WAS TAKEN FOR THE BUSINESS PURPOSES AND HENCE THE FINDINGS OF THE CIT(A) SHOULD BE UPHELD. 5 .1 REGARDING THE SECOND ISSUE OF REIMBURSEMENT OF EXPENSES, HE SUBMITTED THAT THE CIT(A) HAS DIRECTED THE A.O. TO VERIFY AND EXAMINE THE CORRECT AMOUNT OF REIMBURSEMENT AND THEREFORE DEPARTMENT SHOULD NOT BE AGGRIEVED BY SUCH FINDINGS. REGARDING THE LAST ISSUE OF PAYMENT OF COMMISSION TO THE SPECIFIED PERSONS, HE SUBMITTED THAT FIRSTLY , THE COMMISSION PAID TO SHRI VIJAY JAIN WAS PART OF HIS SALARY PACKAGE, WHICH WAS GIVEN IN THE EARLIE R YEARS AND SECONDLY, THE SAME STANDS ALLOWED BY THE CIT(A) IN EARLIER YEARS , AGAINST WHICH NO APPEAL HAS BEEN PREFERRED BY THE DEPARTMENT. THEREFORE, NO DISTURBANCE ON SUCH PAYMENT SHOULD BE MADE. 6 . WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE RELE VANT FINDINGS GIVEN IN THE IMPUGNED ORDERS AND THE MATERIAL PLACED ON RECORD. SO FAR AS THE FIRST ISSUE REGARDING DISALLOWANCE OF PROPORTIONATE INTEREST ON BORROWED FUNDS, IT IS EVIDENT FROM THE FINDINGS GIVEN IN THE IMPUGNED ORDER AS WELL AS MATERIAL PLAC ED ON RECORD THAT , THE BORROWINGS FROM THE BANKS HAS BEEN SUBSTANTIALLY REDUCED IN THIS YEAR, WHEREAS INTEREST FREE BORROWINGS FROM THE SISTER - CONCERNS HAVE INCREASED. THE INTEREST FREE FUNDS HAVE BEEN BORROWED TO REDUCE THE BANK BORROWINGS ONLY. THE FUND FLOW STATEMENT, WHICH IS PART OF THE AUDITED ACCOUNTS, ALSO SHOW THAT THE ASSESSEE HAS GENERATED HUGE CASH FROM OPERATING ACTIVITY. BESIDES THIS, IF THE ASSESSEE HAS TAKEN INTEREST FREE LOANS FROM SISTER - CONCERNS FOR THE PURPOSE OF BUSINESS, THEN THE PAYME NT OF ITA NO. 1571 /MUM/201 1 . M/S.INTERGOLD GEMS PVT.LTD. 9 THE SAID AMOUNT, EVEN IF THEY ARE PARTLY FROM THE INTEREST BEARING BORROWINGS FROM THE BANK, THE SAME CANNOT BE HELD TO BE DIVERSION FOR NON - BUSINESS PURPOSES OR NOT UTILIZED FOR THE PURPOSE OF BUSINESS. THUS, WE AGREE WITH THE CONCLUSION AND FINDING S GIVEN BY THE CIT(A) ON THIS SCORE AND ACCORDINGLY GROUND NO.1 RAISED BY THE REVENUE IS DISMISSED. 6 . 1 REGARDING REIMBURSEMENT OF EXPENSES, IT IS NOTED THAT CIT(A) HAS DECIDED THE ISSUE AGAINST THE ASSESSEE, HOWEVER, HAS DIRECTED THE A.O. TO DISALLOW ONLY THE CORRECT AMOUNT OF REIMBURSEMENT FOR WHICH HE HAS DIRECTED THE AO TO VERIFY THE EXACT AMOUNT. WE DO NOT FIND ANY REASON TO INTERFERE ON SUCH A DIRECTION. ACCORDINGLY GROUND NO.2 RAISED BY THE REVENUE STANDS DISMISSED. 6 . 2 LASTLY , REGARDING DISALLOWANCE OF RS.33,06,289 ON ACCOUNT OF COMMISSION PAID TO SHRI VIJAY JAIN AND M/S.B.ARUNKUMAR & CO., WHO ARE SPECIFIED PERSONS U/S 40A(2)(B), IT IS SEEN FROM THE RECORDS THAT , SHRI VIJAY JAIN IS THE DIRECTOR AND CEO OF THE ASSESSEE - COMPANY AND COMMISSION PAID TO HIM IS A PART OF HIS SALARY PACKAGE, AS HE IS LOOKING AFTER THE ENTIRE BUSINESS OF THE ASSESSEE - COMPANY. THE SAID AMOUNT OF SALARY PACKAGE, WHICH INCLUDES COMMISSION IN COME, WAS THERE IN ASSESSMENT YEARS 2004 - 2005 AND 2005 - 2006 ALSO, WHEREIN THE CIT(A) HAS DELETED THE DISALLOWANCE MADE BY THE A.O. ON SIMILAR GROUNDS. THE SAID ORDER OF THE CIT(A) HAS ATTAINED FINALITY AS NO APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE SAID ORDER. THUS, WE DO NOT FIND ANY REASON TO DISALLOW THE PAYMENT MADE TO SHRI VIJAY JAIN EITHER ON THE GROUND THAT IT IS EXCESSIVE OR IT IS NOT FOR THE PURPOSE OF BUSINESS. SO FAR AS THE DISALLOWANCE OF RS.35,606 ON ACCOUNT OF ITA NO. 1571 /MUM/201 1 . M/S.INTERGOLD GEMS PVT.LTD. 10 COMMISSION PAID TO M/S.B .ARUNKUMAR & CO., IT IS SEEN THAT SIMILAR PAYMENT OF COMMISSION AT THE RATE OF 0.75% OF THE SALES AFFECTED THROUGH THEM HAS BEEN ACCEPTED IN THE EARLIER YEARS AND THE SAME HAS ATTAINED FINALITY. THEREFORE, CONSISTENT WITH THE EARLIER YEARS PRECEDENTS, WE D O NOT FIND ANY REASON TO INTERFERE SUCH A FINDING IN THIS YEAR WITHOUT ANY MATERIAL ON RECORD TO REBUT THE SAME. ACCORDINGLY GROUND NO.3 IS ALSO TREATED AS DISMISSED. 7. IN THE RESULT, REVENUE S APPEAL IS DISMI SSED . ORDER PRONOUNCED ON THIS 13 TH DAY OF FEBRUARY, 2015 . SD/ - SD/ - ( D.KARUNAKARA RAO ) ( AMIT SHUKLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; DATED : 13 TH FEBRUARY , 201 5 . DEVDAS* / COPY OF THE ORDER FORWARDED TO : / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT , MUMBAI. 4. / CIT(A) - 9 , MUMBAI 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE.