RAJESH BASLINGAPPA SANIKOP,KOLHAPUR vs. DEPUTY COMMISSIONER OF INCOME-TAX, ICHALKARANJI CIRCLE, ICHALKARANJI

This appeal by the assessee against the order dated 24-04-2017 passed by the Commissioner of Income Tax (Appeals)-2, Kolhapur [„CIT(A)‟] for assessment year 2010-11.

We find no representation on behalf of the assessee nor any application filed seeking adjournment. Thus, the assessee called absent and set ex-parte. Therefore we proceed to dispose of the case by hearing the ld. DR and perusing the material available on record.

The assessee raised two grounds amongst which the only issue arises for our consideration is as to whether the CIT(A) justified in confirming the addition to an extent of Rs.7,03,000/- in the facts and circumstances of the case.

The facts relating to the issue on hand are that the assessee is an individual filed return of income declaring total income of Rs.51,70,110/-. Under scrutiny notices u/s. 143(2) and 142(1) were issued. In response to which authorized representative on behalf of the assessee appeared before the AO and produced required details as sought by the AO. According to AO, the assessee debited sales commission of Rs.18,73,000/- towards 8 persons. The AO asked the assessee to furnish the details such as name of persons, amount of commission paid. The assessee submitted the details of such 8 persons. In order to verify, the AO issued notice u/s. 133(6) along with summons u/s. 131 to all the above 8 persons. According to AO some persons submitted the information and not attended on given date for examination. Thereby, the AO added an amount of Rs.18,73,000/- on account of sales commission vide this order dated 24-12-2012 u/s. 143(3) of the Act. The CIT(A) restricted the said addition to an extent of Rs.7,03,000/-. Aggrieved by the order of CIT(A), the assessee is before us.

Heard the ld. DR, Shri Vishal A. Makawane and perused the material available on record. The ld. DR submits that the AO in assessment proceedings issued notice u/s. 133(6) and summons u/s. 131 of the Act but, except few, no such other persons mentioned in the table of AO‟s order appeared before the AO in the assessment proceedings. The AO has given ample time to assessee to produce such persons to examine the nature of work and commission paid but the assessee could not bring them before the AO and rightly added the same to the total income of assessee. The CIT(A) accepted the submissions of assessee and giving no opportunity to the AO restricted the addition to an extent of Rs.7,03,000/-.

We note that the assessee did not produce the said persons for examination before the AO and the AO having no confirmations from the said parties made to add entire amount to the total income of assessee but in the First Appellate proceedings the CIT(A) called for complete details of the commission paid to the said parties. The CIT(A) examined the documentary evidences which were already there before the AO. We note that the assessee filed confirmations from 7 parties along with commission agreement before the AO but the AO for non-appearance of such parties proceeded to add said amount to the total income of assessee. The CIT(A) observed that the assessee has filed confirmations and agency commission agreement of 7 parties along with the computation of income of 4 parties out of 7 persons. The ld. DR did not dispute and bring on record any evidence to show the finding of CIT(A) is incorrect. The CIT(A) also observed that there was no confirmations or details regarding the Jignesh S. Ajmera at Sl. No. 1 on the record. We note that there was no evidence before this Tribunal to substantiate the commission paid to Jignesh S. Ajmera. Therefore, having no evidence regarding the commission paid to the said person, the addition made against the commission paid to Jignesh S. Ajmera is sustained. Therefore, we do not find any infirmity in the order of CIT(A) and it is upheld. Thus, the only issue in ground Nos. 1 and 2 raised by the assessee are dismissed.

In the result, the appeal of assessee is dismissed.