ACIT Central Circle 1(1), CHENNAI V. TCP Limited, CHENNAI

ITA 3069/CHNY/2017

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9563 (ITAT-CHENNAI)
• Duration Of Justice: 3 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-07-2021
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 22-04-2021
• Assessment Year: 2011-2012
• Appeal Filed On: 13-12-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R ANITA
• Assessee Lawyers: MRS S VIDYA
• Keywords: Earning of tax free income; Revised return; TDS; Rule 8D; Set aside
• Section: 143(3); 14A; 115JB; 40(a)(ia); 201; 6

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , D B ENCH, CHENNAI . , . , % BEFORE SHRI V.DURGA RAO , JUDICIAL MEMBER AND SHRI G.MANJUNATHA, ACCOUNTANT MEMBER ./ I.T.A.NO.3069/CHNY/2017 ( / ASSESSMENT YEAR: 2011-12) THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1(1) CHENNAI. VS M/S. TCP LTD. 10, TCP SAPTHAGIRIBHAVAN KARPAGAMBAL NAGAR, MYLAPORE, CHENNAI-600 004 . PAN: AAACT 3615K ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MS. R.ANITA, JCIT /RESPONDENT BY : MRS. S.VIDYA, C.A /DATE OF HEARING : 22.07.2021 /DATE OF PRONOUNCEMENT : 28.07.2021 / O R D E R PER G.MANJUNATHA, AM: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAI NST ORDER OF THE LEARNED CIT(A)-18, CHENNAI DATED 18 .09.2017 AND PERTAINS TO ASSESSMENT YEAR 2011-12. 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APP EAL:- 1. THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS ERRONEOUS ON FACTS OF THE CASE AND IN LAW. 2. THE ID. CIT(A) ERRED IN DELETING THE DISALLOWANC E OF RS.2,55,22,111/- MADE BY THE ASSESSING OFFICER (AO) U/S 14A OF THE INCOME TAX ACT,1961, READ WITH RULE 8D OF TH E INCOME TAX RULES, 1962, IN THE ASSESSMENT ORDER FOR AY 201 1-12 PASSED U/S 143(3) OF THE IT ACT,1961,IN THE ASSESSE ES CASE. 2.1 THE ID. CIT(A) ERRED IN HOLDING THAT THE AC SHO ULD RECORD HIS REASONS FOR INVOKING THE PROVISIONS OF SEC.14A R.W RULE 8D AND THE SAME SHOULD BE CONVEYED TO THE ASSESSEE AND ITS OBJECTIONS IF ANY, SHOULD BE OBTAINED AND SINCE IT IS NOT FULFILLED IN THE ASSESSEES CASE, THE AOS ACTION IS LEGALLY NOT TENABLE. 2 ITA NO. 3069/CHNY/2017 2.2 THE LD.CIT(A) OUGHT TO HAVE APPRECIATED THAT TH ERE ARE NO SPECIFIC PROVISIONS IN THE INCOME TAX ACT MANDATING THE ASSESSING OFFICER TO RECORD HIS SATISFACTION SEPARA TELY AND CONVEY THE SAME TO THE ASSESSEE FOR OBTAINING OBJEC TION OF THE ASSESSEE, IF ANY. 2.3 THE LD.CIT(A) OUGHT TO HAVE APPRECIATED THAT IN THE ASSESSMENT ORDER, THE AC HAS QUOTED THE PROVISIONS OF SECTION 14A (2) OF THE IT ACT, WHICH ALSO INCLUDES MENTION OF SATISFACTION AND THAT AFTER DISCUSSING THE SAID PRO VISIONS, THE AO WENT ON TO MAKE DISALLOWANCE U/S 14A AS PER RULE 8D AND AS SUCH, IT THE LD.CIT(A) OUGHT TO HAVE APPRECIATED THAT THE AOS SATISFACTION IS EMBEDDED IN THE ASSESSMENT ORD ER ITSELF. 2.4 THE LD.CIT(A) IS NOT JUSTIFIED IN HOLDING THE A CTION OF THE AO IN INVOKING THE PROVISIONS OF SEC.14A READ WITH RUL E 8D AS LEGALLY NOT TENABLE WHEN THE ASSESSEE ITSELF, IN IT S LETTER DATED 12.03.2014 FILED DURING THE COURSE OF ASSESSMENT PR OCEEDINGS, WORKED OUT DISALLOWANCE OF RS.60,073/- U/S 14A OF T HE IT ACT AND OFFERED THE SAME FOR TAXATION FOR A.Y 2011-12. 2.5 HAVING REGARD TO THE FACT THAT THE AO HAS RIGHT LY COMPUTED THE DISALLOWANCE U/S 14A OF THE IT ACT AS PROVIDED IN RULE 8D OF THE IT RULE 1962, THE LD. CIT(A) OUGHT TO HAVE CONF IRMED THE DISALLOWANCE MADE BY THE AC IN THE ASSESSMENT FOR 2 011-12 IN THE CASE OF THE ASSESSEE. 3. THE ID. CIT(A) ERRED IN DELETING THE DISALLOWANC E OF RS.31,98,200/- MADE BY THE AO, BY TREATING THE CLAI M OF COMMISSION PAYMENT TO MANAGING DIRECTOR OF THE COMP ANY, AS DIVIDEND WITHIN THE MEANING ASSIGNED IN SECTION 36( 1)(II) OF THE INCOME TAX ACT,1961, IN THE ASSESSMENT ORDER FOR AY 2011-12 PASSED U/S 143(3) OF THE IT ACT,1961,IN THE ASSESSE ES CASE. 3.1 THE ID.CIT(A) ERRED IN NOT APPRECIATING THAT TH OUGH THE ASSESSEE CLAIMED THE SAID PAYMENT OF COMMISSION TO BE SALARY AND PAID AS CONTRACTUAL OBLIGATION, THE NATURE OF S ERVICES RENDERED BY THE MANAGING DIRECTOR WAS NOT FURNISHED EVEN DURING THE COURSE OF APPEAL PROCEEDINGS BEFORE HIM. 3.2 THE LD.CIT(A) OUGHT TO HAVE APPRECIATED THAT, I N ITS SUBMISSIONS BEFORE THE ID.CIT(A), THE ASSESSEE HAS STATED THAT THE MANAGING DIRECTOR OFFERED THE COMMISSION INCOME AS SALARY IN HIS INDIVIDUAL RETURNS AND PAID TAXES @30% BUT T HERE IS NO MENTION OF THE ASSESSEE COMPANY DEDUCTING TDS FROM THE SAID PAYMENT OF COMMISSION AND IN SUCH CASE, THE LD.CIT( A), HAVING POWERS CO-TERMINUS AS THAT OF THE AC, ALTERNATIVELY , OUGHT TO HAVE SUBJECTED THE SAID PAYMENT TO DISALLOWANCE U/S 40(A)(IA) OF THE IT ACT. 3 ITA NO. 3069/CHNY/2017 3.3 HAVING RELIED ON THE DECISION IN THE CASE OF M/ S AMD METAPLAST PVT. LTD. VS DCIT 341 ITR 563 (DEL) TO AL LOW RELIEF TO THE ASSESSEE, THE LD.CIT(A) OUGHT TO HAVE APPRECIAT ED THAT IN THE SAID DECISION, IT WAS CLEARLY MENTIONED THAT TH E MD HAD RENDERED SERVICES TO THE COMPANY AND WAS ENTITLED T O RECEIVE COMMISSION FOR SERVICES RENDERED IN TERMS OF BOARD RESOLUTION/APPOINTMENT AS MD AND TDS WAS ALSO MADE FROM THE SAID PAYMENT AND IN THE PRESENT CASE, THE COMMI SSION AS PER ANNUAL AUDIT REPORT, REPRODUCED IN THE ASSESSME NT ORDER, IS PAYABLE AT 1% ON THE PROFITS AND NOT ON ANY TURN OV ER ACHIEVED OR ANY SPECIFIC SERVICE RENDERED BY MD. 3.4 HAVING REGARD TO THE FACT THAT THE PROVISIONS O F SEC.36(1)(II) OF THE IT ACT THAT ANY SUM PAID TO AN EMPLOYEE AS BONUS OR COMMISSION FOR SERVICES RENDERED, WHERE SUCH SUM WO ULD HAVE BEEN PAYABLE TO HIM AS PROFITS OR DIVIDEND IF IT HA D NOT BEEN PAID AS BONUS OR COMMISSION, ARE ATTRACTED IN THIS CASE, THE LD. CIT(A) OUGHT TO HAVE CONFIRMED THE DISALLOWANCE MAD E BY THE AO IN THE ASSESSMENT ORDER FOR AY 2011-12 PASSED U/ S 143(3) OF THE IT ACT, I96I IN THE ASSESSEES CASE. 4. FOR THESE GROUNDS AND ANY OTHER GROUND INCLUDING AMENDMENT OF GROUNDS THAT MAY BE RAISED DURING THE COURSE OF THE APPEAL PROCEEDINGS, THE ORDER OF LEARNED CIT(AP PEALS) MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE R ESTORED. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE CO MPANY IS IN THE BUSINESS OF MANUFACTURING AND TRADING OF C HEMICALS AND GENERATION OF POWER HAS FILED ITS RETURN OF INCOME FOR ASSESSMENT YEAR 2011-12 ON 30.09.2011. THE ASSESSEE HAS SUBSEQUENTLY FILED REVISED RETURN ON 28.08.2012 DEC LARING TOTAL INCOME OF RS.21,81,79,159/- UNDER NORMAL PROVISION S OF THE ACT, AND BOOK PROFIT OF RS.29,11,28,921/-, AS PER SECTION 115JB OF THE INCOME TAX ACT, 1961. THE CASE HAS B EEN SELECTED FOR SCRUTINY AND ASSESSMENT HAS BEEN COMP LETED U/S.143(3) OF THE I.T. ACT, 1961, ON 27.03.2014 AND DETERMINED 4 ITA NO. 3069/CHNY/2017 TOTAL INCOME OF RS.24,68,99,470/-, BY INTER-ALIA, M AKING ADDITIONS TOWARDS DISALLOWANCE U/S.14A FOR RS.2,55, 22,111/- AND DISALLOWANCE OF COMMISSION PAID TO MANAGING DIR ECTOR U/S.36(1)(II) OF THE INCOME TAX ACT, 1961 FOR RS.31 ,98,200/-. 4. BEING AGGRIEVED BY ASSESSMENT ORDER, THE ASSESS EE PREFERRED AN APPEAL BEFORE THE LEARNED CIT(A). BEF ORE THE LEARNED CIT(A), THE ASSESSEE HAS CHALLENGED DISALLO WANCES U/S.14A OF THE ACT ON THE GROUND THAT THE ASSESSIN G OFFICER HAS ERRED IN DISALLOWING OF INTEREST EXPENDITURE, E VEN THOUGH THE ASSESSEE HAS FILED NECESSARY EVIDENCE TO PROVE THAT IT HAS NOT USED INTEREST BEARING FUNDS FOR MAKING INVESTME NTS IN SHARES AND SECURITIES WHICH YIELD EXEMPT INCOME. TH E ASSESSEE HAS ALSO CHALLENGED DISALLOWANCES COMPUTED BY THE ASSESSING OFFICER ON THE GROUND THAT THE ASSESS ING OFFICER HAS NOT RECORDED SATISFACTION AS REQUIRED U/S.14A( 2) OF THE ACT, AND HENCE, IN ABSENCE OF SPECIFIC SATISFACTION HAVI NG REGARD TO BOOKS OF ACCOUNT, HE CANNOT INVOKE RULE 8D OF INCOM E TAX RULES, 1962 TO COMPUTE DISALLOWANCES. THE ASSESSEE HAS ALSO CHALLENGED DISALLOWANCE OF COMMISSION PAID TO MANAG ING DIRECTOR ON THE GROUND THAT COMMISSION HAS BEEN PA ID TO MANAGING DIRECTOR ON THE BASIS OF PROFITS OF THE CO MPANY, WHICH 5 ITA NO. 3069/CHNY/2017 IS IN ACCORDANCE WITH SECTION 309 OF THE COMPANIES ACT, 1956. THEREFORE, THE ASSESSING OFFICER HAS ERRED IN MAKIN G DISALLOWANCE TOWARDS COMMISSION PAID TO MANAGING DI RECTOR. 5. THE LEARNED CIT(A), AFTER CONSIDERING RELEVANT SUBMISSIONS OF THE ASSESSEE AND HAS ALSO BY RELIED UPON THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CAS E OF CIT VS. M/S.HERO MANAGEMENT SERVICES PVT.LTD. REPORTED IN 3 60 ITR 60(DEL), HELD THAT IN ABSENCE OF SATISFACTION AS R EQUIRED UNDER SECTION 14A(2) OF THE ACT, THE ASSESSING OFFICER CA NNOT PROCEED TO COMPUTE DISALLOWANCE BY INVOKING RULE 8D OF INCO ME TAX RULES, 1962, HENCE, DELETED DISALLOWANCES COMPUTED BY THE ASSESSING OFFICER U/S.14A READ WITH RULE 8D OF INCO ME TAX RULES, 1962. AS REGARDS DISALLOWANCE OF COMMISSION PAID TO MANAGING DIRECTOR U/S.36(1)(II) OF THE ACT, THE LEA RNED CIT(A) BY FOLLOWING DECISION OF HONBLE DELHI HIGH COURT IN T HE CASE OF AMD METAPLAST PVT.LTD. VS. DCIT REPORTED IN 341 IT R 563(DEL) HELD THAT THE ASSESSEE HAS PAID COMMISSION TO MANAG ING DIRECTOR, AS PER TERMS OF APPOINTMENT, WHICH IS FU RTHER AUTHORIZED BY THE PROVISIONS OF SECTION 309 OF THE COMPANIES ACT, 1956, AND HENCE, THE ASSESSING OFFICER HAS ERR ED IN DISALLOWING COMMISSION BY INVOKING PROVISIONS OF SE CTION 6 ITA NO. 3069/CHNY/2017 36(1)(II) OF THE ACT. AGGRIEVED BY THE LEARNED CIT( A) ORDER, THE REVENUE IS IN APPEAL BEFORE US. 6. THE FIRST ISSUE THAT CAME UP FOR OUR CONSIDERATI ON FROM GROUND NO.2 OF REVENUE APPEAL IS DISALLOWANCE OF EX PENDITURE IN RELATION TO EXEMPT INCOME U/S.14A OF THE INCOME TA X ACT, 1961. THE FACTS WITH REGARD TO IMPUGNED DISPUTE AR E THAT THE ASSESSEE HAS EARNED DIVIDEND INCOME OF RS.6,99,349/ -, WHICH WAS CLAIMED EXEMPT U/S.10(34) OF THE ACT. THE ASSES SEE HAD ALSO DISALLOWED A SUM OF RS.60,073/- AS EXPENDITUR E INCURRED TOWARDS EARNING EXEMPT INCOME. THE ASSESSING OFFICE R HAS DETERMINED DISALLOWANCE OF RS.2,55,22,111/- BY INVO KING RULE 8D OF INCOME TAX RULES, 1962. 7. THE LEARNED DR SUBMITTED THAT THE LEARNED CIT(A) HAS ERRED IN DELETING DISALLOWANCE COMPUTED BY THE ASSE SSING OFFICER U/S.14A R.W. RULE 8D OF INCOME TAX RULES, 1962, WITHOUT APPRECIATING FACT THAT THE ASSESSING OFFICE R HAS RECORDED SATISFACTION AS REQUIRED UNDER SUB-SECTIO N (2) OF SECTION 14A OF THE ACT. THE DR FURTHER SUBMITTED TH AT DISALLOWANCES CONTEMPLATED U/S.14A OF THE ACT, SHAL L BE COMPUTED IN ACCORDANCE WITH PRESCRIBED METHOD PROVI DED UNDER RULE 8D AND HENCE, THERE IS NO ERROR IN THE C OMPUTATION 7 ITA NO. 3069/CHNY/2017 OF DISALLOWANCES MADE BY THE ASSESSING OFFICER. HOW EVER, THE LEARNED CIT(A), WITHOUT ASSIGNING ANY REASON HAS S IMPLY DELETED ADDITIONS MADE BY THE ASSESSING OFFICER BY HOLDING THAT THERE IS NO SATISFACTION RECORDED BY THE ASSESSING OFFICER AS REQUIRED UNDER LAW. 8. THE LEARNED A.R FOR THE ASSESSEE, ON THE OTHER H AND, SUBMITTED THAT THE ISSUE IS SQUARELY COVERED IN FAV OUR OF THE ASSESSEE BY THE DECISION OF ITAT., CHENNAI IN ASSES SEES OWN CASE FOR ASSESSMENT YEARS 2012-13 & 2013-14 IN ITA NOS.3124 TO 3126/CHNY/2017, WHERE THE TRIBUNAL HAS DIRECTED THE ASSESSING OFFICER TO EXAMINE AVAILABILITY OF SU FFICIENT OWN FUNDS TO COVER UP INVESTMENTS MADE IN SHARES AND SE CURITIES WHICH YIELD EXEMPT INCOME. THE AR FURTHER SUBMITTED THAT AS REGARDS DISALLOWANCE OF OTHER EXPENSES AS REQUIRED UNDER RULE 8D(2)(III) OF INCOME TAX RULES, 1962, IT MAY BE RES TRICTED TO THE EXTENT OF EXEMPT INCOME EARNED FOR THE YEAR. 9. WE HAVE HEARD BOTH THE PARTIES, PERUSED MATERI ALS AVAILABLE ON RECORD AND GONE THROUGH ORDERS OF THE AUTHORITIES BELOW. WE FIND THAT AN IDENTICAL ISSUE HAS BEEN CON SIDERED BY THE TRIBUNAL IN ASSESSEES OWN CASE FOR SUBSEQUENT 8 ITA NO. 3069/CHNY/2017 ASSESSMENT YEARS 2012-13 TO 2014-15 IN ITA NOS.3124 TO 3126/CHNY/2017 VIDE ORDER DATED 08.05.2019, WHERE THE TRIBUNAL HAS HELD THAT THE ASSESSING OFFICER HAS NO T RECORDED SATISFACTION AS REQUIRED U/S.14A(2) OF THE INCOME T AX ACT, 1961. HOWEVER, THE TRIBUNAL HAD DIRECTED THE ASSESSING OF FICER TO VERIFY CLAIM OF THE ASSESSEE WHETHER IT HAS SUFFICI ENT OWN FUNDS BEING SHARE CAPITAL, RESERVES & SURPLUS TO COVER UP INVESTMENTS MADE IN SHARES AND SECURITIES WHICH YIELD EXEMPT IN COME. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT INSOF AR AS DISALLOWANCE OF INTEREST EXPENSES UNDER RULE 8D(2)( II) OF INCOME TAX RULES, 1962, IS CONCERNED, BY FOLLOWING THE DECISION OF CO-ORDINATE BENCH IN ASSESSEES OWN CAS E DATED 08.05.2019, WE DIRECT THE ASSESSING OFFICER TO VE RIFY CLAIM OF ASSESSEE THAT IT HAS SUFFICIENT OWN FUNDS. IN CASE , ASSESSEE IS ABLE TO PROVE AVAILABILITY OF OWN FUNDS, THEN DELET E INTEREST DISALLOWANCE RULE 8D(2)(II) OF INCOME TAX RULES, 19 62. 10. AS REGARDS DISALLOWANCE OF OTHER EXPENSES UNDER RULE 8D(2)(III), IT WAS THE CLAIM OF LEARNED AR FOR THE ASSESSEE THAT DISALLOWANCE COMPUTED BY THE ASSESSING OFFICER MAY BE RESTRICTED TO THE EXTENT OF EXEMPT INCOME EARNED FO R THE YEAR UNDER CONSIDERATION. WE FIND THAT ISSUE OF DISALLOW ANCES OF 9 ITA NO. 3069/CHNY/2017 EXPENDITURE U/S.14A IN EXCESS OF EXEMPT INCOME EARN ED FOR THE YEAR IS NO LONGER RES INTEGRA . THE HON'BLE DELHI HIGH COURT IN THE CASE CHEMINVEST LTD. VS.CIT (2015) 378 ITR 33 HAS CONSIDERED AN IDENTICAL ISSUE AND HELD THAT DISALLO WANCES CONTEMPLATED U/S.14A CANNOT EXCEED EXEMPT INCOME E ARNED FOR THE YEAR UNDER CONSIDERATION. A SIMILAR VIEW H AS BEEN TAKEN BY THE HONBLE HIGH COURT OF DELHI IN THE CASE OF JOINT INVESTMENTS PVT .LTD VS. CIT REPORTED IN 372 ITR 6 94, WHERE IT WAS HELD THAT DISALLOWANCES CONTEMPLATED U/S.14A CA NNOT SWALLOW ENTIRE EXEMPT INCOME FOR THE YEAR UNDER CON SIDERATION. IN THIS CASE, THE ASSESSEE HAS EARNED DIVIDEND INCO ME OF RS.6,99,349/-, WHEREAS THE ASSESSING OFFICER HAS C OMPUTED DISALLOWANCE OF RS.6,99,349/- . THEREFORE, WE ARE O F THE CONSIDERED VIEW THAT DISALLOWANCE COMPUTED BY THE A SSESSING OFFICER IS DISPROPORTIONATE AND CONTRARY TO THE SET TLED PRINCIPLE OF LAW BY VARIOUS HIGH COURTS INCLUDING THE HONBLE DELHI HIGH COURT. HENCE, WE DIRECT THE ASSESSING OFFICER TO RE STRICT DISALLOWANCES CONTEMPLATED U/S.14A READ WITH RULE 8 D(2)(III) OF THE INCOME TAX RULES, 1962, TO THE EXTENT OF EXE MPT INCOME EARNED FOR THE YEAR. 10 ITA NO. 3069/CHNY/2017 11. THE NEXT ISSUE THAT CAME UP FOR OUR CONSIDERAT ION FROM GROUND NO.3 OF REVENUE APPEAL IS DISALLOWANCE OF CO MMISSION PAID TO MANAGING DIRECTOR U/S.36(1)(II) OF THE ACT. THE ASSESSING OFFICER HAS DISALLOWED COMMISSION PAID TO MANAGING DIRECTOR U/S.36(1)(II) OF THE ACT, ON THE GROUND TH AT THE ASSESSEE HAS PAID COMMISSION TO MANAGING DIRECTOR IN LIEU OF PROFITS OR DIVIDEND. IT WAS THE EXPLANATION OF THE ASSESSEE BE FORE THE AUTHORITIES THAT COMMISSION HAS BEEN PAID TO MANAGI NG DIRECTOR, AS PER TERMS OF APPOINTMENT, WHICH IS AUT HORIZED BY SECTION 309 OF THE COMPANIES ACT, 1956. 12. HAVING HEARD BOTH THE SIDES AND CONSIDERED MA TERIAL AVAILABLE ON RECORD, WE FIND THAT THIS ISSUE IS ALS O COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE TRIBU NAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2012-13 TO 2014-15 IN ITA NOS. 3124 TO 3126/CHNY/2017 DATED 08.05.2019 , WHERE THE TRIBUNAL HAS CONSIDERED AN IDENTICAL ISSUE AN D BY FOLLOWING DECISION OF THE HONBLE HIGH COURT OF DELHI IN THE CASE OF M/S. AMD METAPLAST PVT.LTD.VS. DCIT REPORTED IN 341 IT R 563 DELETED ADDITIONS MADE BY THE ASSESSING OFFICER TOW ARDS COMMISSION PAID TO MANAGING DIRECTOR. THE FACTS REM AIN UNCHANGED AND THE REVENUE HAS FAILED TO BRING ON RE CORD ANY 11 ITA NO. 3069/CHNY/2017 EVIDENCES TO PROVE THAT FINDINGS OF FACT RECORDED B Y THE LEARNED CIT(A) IN LIGHT OF DECISION OF HONBLE DELHI HIGH C OURT IN THE CASE OF AMD METAPLAST PV.LTD.(SUPRA) IS INCORRECT . THEREFORE, BY FOLLOWING THE DECISION OF THE TRIBUNAL IN ASSESS EES OWN CASE FOR SUBSEQUENT ASSESSMENT YEARS IN ITA NOS.3124 TO 3126/CHNY/2017 DATED 08.05.2019, WE ARE OF THE CON SIDERED VIEW THAT ASSESSING OFFICER HAS ERRED IN DISALLOWIN G COMMISSION PAID TO MANAGING DIRECTOR U/S.36(1)(II) OF THE ACT AND HENCE, WE ARE INCLINED TO UPHOLD THE FINDINGS OF THE LEARN ED CIT(A) AND REJECT GROUND TAKEN BY THE REVENUE. 13. IN THE RESULT, APPEAL FILED BY REVENUE IS PARTL Y ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH JULY, 2021 SD/- SD/- ( . ) ( . ) (V.DURGA RAO) ( G.MANJUNATHA ) # % / JUDICIAL MEMBER % / ACCOUNTANT MEMBER # /CHENNAI, ( /DATED 28 TH JULY, 2021 DS *+ ,+ /COPY TO: 1. APPELLANT 2. RESPONDENT 3. - () /CIT(A) 4. - /CIT 5. + 1 /DR 6. /GF .