Rohit Mehndiratta, Panipat V. ITO, Panipat

ITA 5629/DEL/2011

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69656 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 11 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-12-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 02-12-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 15-12-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VED PRAKASH MISHRA
• Assessee Lawyers: K C ANEJA
• Keywords: Gift; Depreciation; Commercial expediency

Judgement Text

1 ITA NO. 56 29/DEL/2011 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: F NEW DELHI BEFORE SHRI N.K. SAINI, ACCOUNTANT ME MBER & SMT. BEENA A PILLAI, JUDICIAL MEMBER I.T.A .NO.-5629/DE L/2011 (ASSESSMENT YEAR-2008- 09) ROHIT MEHNDIRATTA, PROP. SHAM SALES CORPORATION SHOPT NO. 30-31, PALIKA BAZAR PANIPAT. ADFPM9745G VS ITO, WARD-1, PANIPAT. APPELLANT BY SHRI K.C. ANEJA, ADV. RESPONDENT BY SH. VED PRAKASH MISHRA, SR. DR ORDER PER BEENA PILLAI, JUDICIAL MEMBER : THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER DATED 16/09/2011 BY THE LD. CIT(A)-KARNAL FOR A.Y. 2008-09 ON THE FOLLOWING GROUNDS OF APPEAL: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE TRADING ADDITIONS OF RS. 8,60,901/- HAVE WRONGLY AN D ARBITRARILY BEEN MADE BY APPLYING GP RATE @ 8% AGAI NST 6.49% SHOWN ON ESTIMATED SALES AT RS. 5,60,00,000/- AGAINST SHOWN AT RS. 5,57,61,203/- AND THE LD. CIT( A) ERRED IN CONFIRMING THE SAME. 2. THAT BOOKS OF ACCOUNTS WERE MAINTAINED IN REGULAR COURSE OF BUSINESS, WHICH WERE COMPLETE AND VERIFIED. NO DATE OF HEARING 02.12.2015 DATE OF PRONOUNCEMENT 21.01.2016 2 ITA NO. 56 29/DEL/2011 OMISSION OR ERROR WAS FOUND OUT. MERE NON-MAINTENA NCE OF DAILY STOCK REGISTER IS NOT A GROUND TO REJECT THE BOOKS AND ESTIMATE INCOME. 3. THAT INTEREST AMOUNTING TO RS. 5,09,564/- HAS WRO NGLY BEEN DISALLOWED BY CHARGING OLD INVESTMENTS MADE ON LAND, SHOP AND ADVANCES FOR COMMERCIAL MATTERS. 4. THAT AIR-FARE TICKET EXPENSES RS. 33,000/- INCURR ED FOR WIFE GUNJAN, TO EXPLORE NEW BUSINESS HAVE WRONGLY B EEN DISALLOWED AND THE LD. CIT(A) ERRED IN CONFIRMING T HE SAME. 5. THAT DISALLOWANCE OF RS. 1,51,652/- HAVE WRONGLY BEEN MADE AND ARE NOT COVERED BY THE PROVISIONS OF SECTI ON 40(A)(IA) OF THE I.T. ACT, 1961. 6. THAT ADDITIONS OF RS. 30,000/- FOR THE ALLEGED LO W HOUSEHOLD EXPENSES HAVE WRONGLY BEEN MADE. 7. THAT ADDITIONS AND DISALLOWANCES OF RS. 3,32,530/ - FOR THE ALLEGED BY APPLICATION OF SECTION 40(A)(IA) HAV E WRONGLY BEEN MADE AND ARE NOT WARRANTED BY LAW. 8. THAT THE ASSESSMENT AS MADE IS FACTUALLY WRONG AN D LEGALLY BAD AND DESERVE TO BE QUASHED. 2. THE FACTUAL BACKGROUND OF THE ASSESSEE HAS RECOR DED BY THE AUTHORITIES BELOW ARE AS UNDER: 2.1.THE ASSESSEE DERIVES ITS INCOME FROM BUSINESS O F FOOTWEAR AND TRADING OF IMPORTED MINK BLANKETS, UNDER THE PROPRI ETARY CONCERN BEING SHAM SALES CORPORATION. THE ASSESSEE HAD FIL ED HIS RETURN OF INCOME ON 06/10/08 FOR ASSESSMENT YEAR UNDER CONSID ERATION, DECLARING TOTAL INCOME OF RS. 4,64,000/-, PLUS AN A GRICULTURAL INCOME OF RS. 26,000/-. THE RETURN WAS PROCESSED U /S 143(1) OF THE ACT AND THE RETURNED INCOME WAS ACCEPTED. SUBS EQUENTLY, THE CASE WAS SELECTED FOR SCRUTINY, AND NOTICES WERE IS SUED ON 23/09/09, AND SERVED UPON THE ASSESSEE. 3. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD DISCLOSED GRO SS PROFIT OF RS. 3 ITA NO. 56 29/DEL/2011 39,19,099/- ON SALES OF RS. 5,57,61,203/-, YIELDING A NET PROFIT RATE OF 6.49%. THE LD. ASSESSING OFFICER, DURING THE AS SESSMENT PROCEEDINGS OBSERVED THAT THE ASSESSEE HAD NOT MAIN TAINED PROPER STOCK REGISTER TO CHECK THE ACCURACY OF PURCHASES A ND SALES. THE LD. ASSESSING OFFICER ASKED TO FURNISH A COMPARATIVE CH ART FOR THE PRECEDING YEARS. THE LD. ASSESSING OFFICER OBSERVE D THAT THERE WAS A CONSIDERATE FALL IN THE GP RATE AS COMPARED TO TH AT OF THE LAST YEAR. THE LD. ASSESSING OFFICER RECORDED THAT THE ASSESSEE COULD NOT SUBSTANTIATE FOR THE FALL IN THE GP RATE, AS COMPAR ED TO THE PREVIOUS YEARS. ACCORDINGLY, THE LD. ASSESSING OFFICER REJE CTED THE BOOKS OF ACCOUNTS AND ESTIMATED THE GROSS PROFIT AT 8% AS AG AINST 6.49% SHOWN BY THE ASSESSEE. THE LD. ASSESSING OFFICER O BSERVED THAT ASSESSEE HAS CHARGED INTEREST TO AN EXTENT OF RS. 1 9,025/- AND HAS PAID INTEREST TO THE BANK TO AN EXTENT OF RS. 5,09, 564/-. THE ASSESSEE HAD ADVANCED LOANS TO DIFFERENT PARTIES AM OUNTING TO RS. 46,62,256/-. THE LD. ASSESSING OFFICER, THEREFORE, DISALLOWED THE INTEREST PAID BY THE ASSESSEE TO AN EXTENT OF RS. 5 ,09,564/-. THE INTEREST CALCULATED ON THE INTEREST FREE ADVANCES A ND INTEREST FREE INVESTMENT EXCEEDED THE INTEREST CLAIMED IN THE PRO FIT AND LOSS ACCOUNT ON BORROWINGS FOR NON BUSINESS PURPOSES. 3.1 THE LD. ASSESSING OFFICER FURTHER OBSERVED THAT ASSESSEE HAD DEBITED AN AMOUNT OF RS. 1,51,620/- TO VARUN ESTATE AND THE SAME HAS BEEN MADE WITHOUT DEDUCTING TDS. THE LD. ASSES SING OFFICER, THEREFORE, MADE AN ADDITION OF RS. 1,51,652/- U/S 4 0(A)(IA) OF THE ACT. 4 ITA NO. 56 29/DEL/2011 3.2 THE LD. ASSESSING OFFICER ALSO OBSERVED THAT AS SESSEE HAD DEBITED AN AMOUNT OF RS. 68,800/- ON ACCOUNT OF HOU SEHOLD EXPENSES. THE LD. ASSESSING OFFICER MADE AN ADDITI ON OF RS. 30,000/- ON THE GROUND OF LOW HOUSEHOLD WITHDRAWALS . 3.3 FURTHER, THE LD. ASSESSING OFFICER OBSERVED THA T THE SUM OF RS. 3,08,206/- ON ACCOUNT OF FOREIGN TRAVEL WAS DEBITED . IN THE DETAILS FILED BY THE ASSESSEE IT WAS SUBMITTED THAT WIFE OF THE ASSESSEE HAD VISITED THE DESTINATION ALONG WITH THE ASSESSEE. T HE LD. ASSESSING OFFICER DISALLOWED AN AMOUNT OF RS. 33,300/- ON THE GROUND THAT THE WIFE OF THE ASSESSEE HAD VISITED THE FOREIGN DE STINATION FOR NON BUSINESS PURPOSES. 4. AGGRIEVED BY THE ORDER OF THE LD. ASSESSING OFFI CER, THE ASSESSEE WENT INTO APPEAL BEFORE THE LD. CIT(A). T HE LD. CIT(A) CONFIRMED THE ADDITIONS MADE BY THE LD. ASSESSING O FFICER. 5. AGGRIEVED BY THE ORDER OF THE LD. CIT(A) THE AS SESSEE IS IN APPEAL BEFORE US. 6. GROUND NOS. 1 & 2 : THE LD. AR SUBMITS THAT APPELLANT IS THE PROPRIETOR OF SHAM SALES CORPORATION AND HAD BEEN DOING RETAIL SALES BUSINES S OF REEBOK PRODUCTS SUCH AS READYMADE GARMENTS, FOOTWEAR, ETC. AND WHOLESALE BUSINESS IN CHINA MINK BLANKETS. HE SUBM ITTED THAT THE PURCHASES AND SALES WERE FULLY VOUCHED. REGULAR BO OKS OF ACCOUNTS WERE MAINTAINED BY THE ASSESSEE, WHICH WERE SUPPORT ED BY CASH BOOK, LEDGER AND BANK STATEMENTS. THE DETAILS OF T HE CLOSING STOCK WERE ALSO FURNISHED ALONG WITH THE AFORESAID DETAIL S TO THE AUTHORITIES BELOW. THE LD. AR FURTHER SUBMITTED THA T DUE TO THE 5 ITA NO. 56 29/DEL/2011 VARIETY OF PRODUCTS IN DIFFERENT SIZES, COLORS DAY TO DAY STOCKS COULD NOT BE MAINTAINED. HE FURTHER SUBMITTED THAT THE L D. ASSESSING OFFICER HAS NOT DOUBTED THE GENUINITY OF THE PURCHA SE AND SALES. IT WAS SUBMITTED THAT THE LD.AO COULD NOT COME OUT WIT H ANY MATERIAL THAT COULD PROVE THAT, THE TRANSACTIONS OF PURCHASE AND SALE BY THE ASSESSEE WERE BOGUS. THE GP RATE AS COMPARED TO TH E EARLIER YEAR WAS LOW AS THE SALES INCREASED SIX TIMES MORE. EVE N THE MARGIN OF PROFIT EARNED BY THE ASSESSEE WAS BETTER. THE LD. AR FURTHER SUBMITTED THAT THE ASSESSEE HAD TAKEN DUE PRECAUTIO N AND HAD MENTIONED THE VARIETIES AND SIZES ALONG WITH THE QU ANTITY IN THE BILLS OF ENTIRE SALES MADE TO THE DEALERS AND THE S AME WERE VERIFIABLE. THE LD. AR SUBMITTED THAT ONLY BECAUSE DAY TO DAY STOCK REGISTER WAS NOT MAINTAINED BY THE ASSESSEE, THE LD . ASSESSING OFFICER AND THE LD. CIT(A) REJECTED THE BOOKS OF AC COUNT MAINTAINED BY THE ASSESSEE AND ESTIMATED THE GP RATE AT 8%. T HE LD. AR POINTED OUT THAT LD. ASSESSING OFFICER COULD NOT BR ING OUT ANY MATERIAL OR DEFECT TO REJECT THE BOOKS OF ACCOUNT M AINTAINED BY THE ASSESSEE. 6.1. ON THE CONTRARY, THE LD. DR SUBMITTED THAT TH E LD. ASSESSING OFFICER HAS CORRECTLY REJECTED THE BOOKS OF ACCOUNT AS THE SALES AND PURCHASES WERE NOT VERIFIABLE. THE ESTIM ATION OF GP RATE AT 8% BY THE LD. ASSESSING OFFICER WAS NOT UNREASON ABLE. THE LD. DR SUPPORTED THE ORDERS PASSED BY THE AUTHORITIES B ELOW. 7. WE HAVE PERUSED THE RECORDS AND THE SUBMISSIONS MADE BY BOTH THE PARTIES. 6 ITA NO. 56 29/DEL/2011 7.2. IT IS AN ADMITTED FACT THAT THE ASSESSING OFF ICER HAS NOT DISPUTED THE PURCHASES AND SALES AND HAS NOT BROUGH T ON RECORD ANY DEFECT OR MATERIAL TO PROVE THAT THE PURCHASE A ND SALE TRANSACTIONS ENTERED INTO BY THE ASSESSEE WERE BOGU S. THE LD. ASSESSING OFFICER HAS REJECTED THE BOOKS OF ACCOUNT MERELY ON THE GROUND THAT THE ASSESSEE HAS NOT MAINTAINED DAY TO DAY STOCK REGISTER. THIS CANNOT BE THE REASON FOR REJECTING THE BOOKS OF ACCOUNT MAINTAINED BY THE ASSESSEE. AS HELD BY THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. JAS JACK ELEGANCE EXPORTS REPORTED IN 324 ITR 95 MERELY BECAUSE THERE WAS A F ALL IN THE GP AND THAT THE STOCK REGISTER HAS NOT BEEN MAINTAINED WITHOUT ANY FINDING BY THE LD. ASSESSING OFFICER THAT THE ACCOU NTS MAINTAINED BY THE ASSESSEE ARE DEFECTIVE, REJECTION OF BOOKS OF A CCOUNT IS NOT JUSTIFIED. 7.3. ACCORDINGLY, WE DELETE THE ADDITION MADE BY T HE ASSESSING OFFICER BY APPLYING GP RATE AT 8% AS AGAINST 6.49% SHOWN BY THE ASSESSEE. GROUND NO. 1 & 2 ARE ACCORDINGLY ALLOWED . 8. GROUND NO. 3 : THE LD. AR SUBMITTED THAT THE ASSESSING OFFICER HAS WRONGLY CHARGED THE INTEREST ON VARIOUS ADVANCES MADE BY TH E ASSESSEE. 1. A.S. STEEL TUBES PVT. LTD. RS. 7,36,200/- 2. DAP ESTATE RS. 1,18,000/- 3. GUNJAN MEHENDIRATTA RS. 4,00,000/- 4. KRISHAN LAL BUDHIRAJA RS. 3,00,000/- 5. PARAS RAM HOULDING RS. 57,280/- 6. SANDEEP KUMAR RS. 5,00,000/- 7. RAJEEV KUMAR RS. 2,00,000/- 8. SHAM STORE RS. 3,50,000/- 9. SHOP GOODWILL RS. 1,40,000/- 7 ITA NO. 56 29/DEL/2011 10. SONIA GIFT RS. 3,99,248/- 11. SUPER TRADING COMPANY RS. 12,11,528/- 12. YOGITA SISTER RS. 2,50,000/- TOTAL RS. 46,62,256/- .. SUM OF RS. 4,00,000/- IN THE NAME OF GUNJAN MEHENDI RATTA PERTAINS TO FLOATING OF NEW SHOP, WHICH INCOME ULTI MATELY WAS REQUIRED TO BE ADDED IN THE INCOME OF THE ASSES SEE AS PER PROVISIONS OF SECTION 64 OF THE INCOME TAX ACT, 1961 AND FURTHER ADVANCES TO RAJEEV KUMAR, SANDEEP KUMAR AND SHAM STORE SUM OF RS. 2,00,000/-, RS. 5,00,000 /-, RS. 3,50,000/- TOTAL RS. 10,50,000/- WERE FOR COMME RCIAL EXPEDIENCY. THESE PERSONS ARE WELL REPUTED BUSINES SMAN AND BY VIRTUE OF THEIR EXPERIENCE THEY OBLIGED BY S ENDING CUSTOMERS. THIS EXPENDITURE WAS FOR THE PURPOSE OF BUSINESS, WHICH NEED NOT NECESSARILY BE THE BUSINES S OF THE ASSESSEE ITSELF AND BUSINESSMAN CANNOT BE COMPE LLED TO MAXIMIZE HIS PROFITS. THE ASSESSEE HAS THUS NOT UTILIZED THE BANK LOAN FOR SUCH ACTIVITIES. THE ASSESSEE HA S TRADE CREDITORS AND TRADE DEBTORS, WHICH ARE NOT AGAINST CONSIDERATION OF INTEREST. 8.1. THE LD. AR SUBMITTED THAT LD. ASSESSING OFFIC ER HAS CHARGED FURTHER INTEREST ON THE INVESTMENT AMOUNTIN G TO RS. 16,80,540/- MADE BY THE ASSESSEE IN SHOP ALONG WITH HIS WIFE GUNJAN MAHENDRATTA, WHICH IS FOR DOING BUSINESS AND EARNING PROFIT. THE, LD.ASSESSING OFFICER HAS ARBITRARILY CHARGED INTEREST ON NOTIONAL GROUNDS ON HIS SURMISES AND CONJECTURES, A MOUNTING TO RS. 5,28,589/-. THE LD. AR SUBMITTED THAT THE BORROWIN GS WERE FOR CARRYING OUT THE BUSINESS ACTIVITIES OF THE ASSESSE E. 8.2. ON THE CONTRARY, THE LD. DR HAS PLACED HIS RE LIANCE ON THE ORDERS PASSED BY THE AUTHORITIES BELOW. 8 ITA NO. 56 29/DEL/2011 8.3. WE HAVE PERUSED THE RECORDS AND THE ARGUMENTS BY BOTH THE PARTIES. 8.4. THE LD.AR CONTENDED THAT THE ADVANCES MADE TO RAJIV KUMAR, SANDEEP KUMAR AND SHAM STORE WERE IN THE PRO CESS OF COMMERCIAL EXPEDIENCY. THE LD. AR FURTHER SUBMITTE D THAT ANY INCOME THAT WOULD ARISE FROM THE SHOP PURCHASED IN THE NAME OF GUNJAN MAHENDRA DUTTA (SPOUSE OF THE ASSESSEE) WOUL D BE CONSIDERED AS INCOME IN THE HANDS OF THE ASSESSEE U /S 64 OF THE ACT. THE ASSESSEE HAD ALSO MADE AN INVESTMENT IN SHOP TO AN EXTENT OF RS. 16,80,540/- AND THE LD. ASSESSING OFFICER DISAL LOWED THE INTEREST TO AN EXTENT OF THE INVESTMENT MADE IN THE SHOP ON THE GROUND THAT NO DEPRECIATION IS CLAIMED BY THE ASSESSEE. WE OBS ERVE THAT THE AUTHORITIES BELOW HAVE WITHOUT APPRECIATING THE FAC TS AND BRINGING COGENT MATERIALS ON RECORD DISALLOWED THE INTEREST EXPENDITURE. IN OUR OPINION THIS ISSUE REQUIRES FRESH ADJUDICATION AT THE LEVEL OF THE ASSESSING OFFICER, THEREFORE, THIS ISSUE IS SET ASI DE TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION IN ACCORDA NCE WITH LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF BEING H EARD TO THE ASSESSEE. WE, THEREFORE, DELETE THE ADDITION OF INT EREST AMOUNTING TO RS. 5,09,564/-. 9. GROUND NO. 4 : THE LD. AR SUBMITTED THAT MRS. GUNJAN WIFE OF ASSES SEE HAD ASSISTED ON A FOREIGN BUSINESS TRIP. THE LD. ASSESSING OFFI CER HAS WRONGLY DISALLOWED AN EXPENSES AMOUNTING TO RS. 33,000/- WI THOUT ANY BASIS. THE LD. AR SUBMITTED THAT SMT. GUNJAN HAD A CCOMPANIED THE 9 ITA NO. 56 29/DEL/2011 ASSESSEE TO GAIN BUSINESS INFORMATION WHICH WAS ADV ANTAGEOUS AND HENCE SHOULD BE CONSIDERED FOR THE PURPOSES OF BUSI NESS. 9.1. ON THE CONTRARY, THE LD. DR SUPPORTED THE ORDE RS OF THE AUTHORITIES BELOW. 9.2. WE FIND THAT THE LD. ASSESSING OFFICER HAS DIS ALLOWED AN AMOUNT OF RS. 33,000/- FOR WANT OF EVIDENCES IN REGARDS TO THE FOREIGN TRAVEL OF MRS. GUNJAN ALONG WITH THE ASSESSEE. WE DO NOT FIND ANY REASON TO INTERFERE WITH THE FINDINGS OF THE AUTHORITIES B ELOW. 9.3. WE, ACCORDINGLY, DISMISSED THIS GROUND OF APPE AL AND CONFIRMED THE ADDITION MADE BY THE LD. ASSESSING OFFICER TO A N EXTENT OF RS. 33,000/- INCURRED FOR MRS. GUNJAN. 10. GROUND NO. 5 : THE LD. AR SUBMITTED THAT THIS DISALLOWANCE OF RS. 1,51,652/- PERTAINS TO MAINTENANCE EXPENSES PAID TOWARDS THE S HOP ACQUIRED BY THE ASSESSEE IN MEGA MALL, SECTOR 25, HUDA WHICH FORMS A PART OF BUSINESS ASSETS. THE LD. AR SUBMITTED THAT THE EXPENSES INCURRED TOWARDS CLEANING, ELECTRIFICATION, MAINTENANCE, CON SUMER EXPENSES WHICH THE ASSESSEE WAS SUPPOSED TO MAKE IN THE COMM ON POOL. THE LD. AR FURTHER SUBMITTED THAT TDS COULD NOT BE DEDU CTED ON SUCH PAYMENTS WHICH WERE MADE TO THE LABOURERS WHO WERE INVOLVED IN SUCH ACTIVITIES. THE LD. AR SUBMITTED THAT THE DIS ALLOWANCE MADE BY THE LD. ASSESSING OFFICER U/S 40(A)(IA) OF THE ACT WAS NOT JUSTIFIED. 10.1. THE LD. DR ON THE CONTRARY, SUPPORTED THE ORD ER OF THE AUTHORITIES BELOW. WE NOTE THAT THE ASSESSEE HAVIN G A SHOP AT MEGA MALL, SECTOR 25, HUDA HAD OTHER CO-OWNERS. IT IS D IFFICULT TO BELIEVE THAT ASSESSEE WOULD BE INCURRED EXPENSES TO AN EXTE NT OF RS. 10 ITA NO. 5 629/DEL/2011 1,51,652/- FOR THE YEAR UNDER CONSIDERATION TO MAIN TAIN THE SHOP. 10.2. WE, THEREFORE, RESTRICT THE DISALLOWANCE TO A N EXTENT OF RS. 50,000/-. THE GROUND OF APPEAL ACCORDINGLY IS PART LY ALLOWED. 11. GROUND NO. 6 : THE LD. AR SUBMITTED THAT THE ASSESSEE HAS BEEN WIT HDRAWING A SUM OF RS. 60,000/- AS HOUSEHOLD EXPENSES. FURTHER, TH E LD. AR SUBMITS THAT IT HAD ACCORDINGLY INCOME TO AN EXTENT OF RS. 26,000/-. THE LD. AR SUBMITTED THAT AN AMOUNT OF RS. 86,000/- WAS SUF FICIENT FOR THE ASSESSEE WITH HIS FAMILY AND PARENTS LIVING TOGETHE R. 11.1. ON THE CONTRARY, THE LD. DR SUPPORTED THE ORD ERS OF THE AUTHORITIES BELOW. 11.2. WE HAVE NOTED THAT THE ASSESSEE HAS AN ADDITI ONAL AMOUNT OF RS. 26,000/- AS AGRICULTURAL INCOME OVER AND ABO VE THE AMOUNT WITHDRAWN TO AN EXTENT OF RS. 60,000/-. CONSIDERIN G THE SMALLNESS OF THE FAMILY THE ADDITION MADE BY THE ASSESSING OF FICER ON ACCOUNT OF LOW HOUSEHOLD EXPENSES IS NOT JUSTIFIED. 11.3. WE, THEREFORE, DELETE THE ADDITION MADE BY TH E LD. ASSESSING OFFICER. THIS GROUND OF APPEAL IS ALLOWED. 12. GROUND NO. 7 : THE LD. AR SUBMITS THAT IN THE RELEVANT YEAR UNDER CONSIDERATION THE ASSESSEE HAD PAID COMMISSION TO MAHESH KAPOOR, PROP . KAPOOR TEXTILES, AMOUNTING TO RS. 3,32,530/-, FOR PROMOTIN G THE SALES OF THE ASSESSEE. THE LD. AR SUBMITTED THAT COMMISSION WAS PAID AT THE END OF THE YEAR ON FINALIZATION OF THE ACCOUNTS TO ITS AGENTS. THE ASSESSEE FURTHER SUBMITTED THAT ALL THE AGENTS TO W HOM THE COMMISSION WAS PAID WERE ASSESSED WITH THE DEPARTME NT AND THEIR 11 ITA NO. 5 629/DEL/2011 CONFIRMATIONS WERE ALSO FILED BEFORE THE LD. ASSESS ING OFFICER. THE LD. AR SUBMITTED THAT THE TAX WAS DULY DEDUCTED AND PAI D TO THE GOVERNMENT TREASURY AND, THEREFORE, THE ADDITION MA DE BY THE ASSESSING OFFICER WAS NOT JUSTIFIED. 12.1. ON THE CONTRARY, THE LD. DR SUPPORTED THE ORD ERS OF THE AUTHORITIES BELOW. 12.2. THE LD. AR HAS SUBMITTED BEFORE US TODAY A CO MPILATION OF THE CONFIRMATION ACCOUNT STATEMENT, ACKNOWLEDGMENT OF THE COPY OF THE RETURNS FILED IN THE CASE OF MAHESH KAPOOR ALON G WITH HIS COMPUTATION OF INCOME FOR A.Y. 2008-09. FROM THE R ECORDS FILED BEFORE US, WE NOTE THAT ASSESSEE HAS MADE PAYMENT B Y WAY OF COMMISSION TO SHRI MAHESH KAPOOR AMOUNTING TO RS. 3 ,32,530/- COMMISSION AGENTS THE ASSESSEE COULD PROVE THE TDS BEING DEDUCTED AS OBSERVED FROM THE ORDER OF THE LD. ASSE SSING OFFICER. AS THE COMMISSION IS PAID BY THE ASSESSEE ON THE LAST DATE OF THE ASSESSMENT YEAR, IT MAY NOT BE POSSIBLE THAT THE TD S HAVE BEEN DEPOSITED ON OR BEFORE THE END OF THE FINANCIAL YEA R RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION. 12.3. WE, THEREFORE, SET ASIDE THIS ISSUE TO THE F ILE OF THE LD. ASSESSING OFFICER BECAUSE IT IS NOT CLEAR AS TO WHE THER THESE DOCUMENTS FURNISHED BEFORE US WERE AVAILABLE TO THE LDAO FOR HIS EXAMINATION AND VERIFICATION. THEREFORE FOR LIMITED PURPOSES OF VERIFICATION OF THE SAID DOCUMENTS AND OF THE TDS D EDUCTED, IF ANY, ON BEHALF OF MAHESH KAPOOR, ON THE PAYMENT MADE, AM OUNTING TO RS.3,32,530/- ON THE BASIS OF THE DOCUMENTS FILED. THE LD.AO AFTER VERIFICATION MAY ALLOW THE CLAIM OF THE ASSESSEE. 12 ITA NO. 5 629/DEL/2011 12.4. ACCORDINGLY, THIS GROUND OF APPEAL STANDS ST ATISTICALLY ALLOWED. 13. IN THE RESULT, THE APPEAL FILED BY THE ASSESSE E STANDS PARTLY ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 21.01. 2016 SD/- SD/- (N.K. SAINI) (BEENA A PILLAI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 21.01.2016 *KAVITA, P.S. COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI