SRI PARAG CHANDRAKANT BOGHANI,KOLKATA vs. ITO, WD.35(1), KOLKATA, KOLKATA

The assessee in thepresent case is an individual, who is engaged in the business of wholesale trading of crockery, PVC Flakes, etc. under the name and style of his proprietary concern M/s. Parag Enterprises. The return of income for the year under consideration was filed by him on 24.09.2009 declaring total income of Rs.8,03,418/-. In the Profit & Loss ./2014 Assessment year: 2009-2010 Page 2 of 3 Account filed along with the said return, a sum of Rs.8,00,000/- was debited by the assessee on account of commission paid to M/s. Escort Enclave Pvt. Limited. In order to verify the said payment, notices under section 133(6) were issued by the Assessing Officer to M/s. Escort Enclave Pvt. Limited. The said notices as well as the summons issued subsequently by the Assessing Officer under section 131, however, remained un-complied with.

Although the assessee filed a copy of TDS certificate issued by the said party showing deduction of tax at source from the payment of commission of Rs.8,00,000/-, it was found by the Assessing Officer that no return of income for the year under consideration has been filed by the said party. The assessee also could not file any evidence to support and substantiate its claim of having made his payment of commission in the subsequent year. The Assessing Officer, therefore, disallowed the commission of Rs.8,00,000/- and added the same to the total income of the assessee in the assessment completed under section 143(3) vide an order dated 30.12.2011.

Against the order passed by the Assessing Officer under section 143(3), an appeal was preferred by the assessee before the ld. CIT(Appeals) and since the submissions made by the assessee in support of his case on the issue of disallowance of commission were not found acceptable by him, the ld. CIT(Appeals) proceeded to confirm the said disallowance made by the Assessing Officer. Aggrieved by the order of the ld. CIT(Appeals), the assessee has preferred this appeal before the Tribunal.

I have heard the arguments of both the sides and also perused the relevant material available on record. As submitted by the ld. counsel for the assesee, payment of commission in question was not made by the assessee at the relevant time and in the absence of payment, the evidence to show such payment could not be produced by him. He has contended ./2014 Assessment year: 2009-2010 Page 3 of 3 that the assessee now has not only made the payment of commission, but has also gathered evidence to support and substantiate his claim on account of such commission. He has urged that one more opportunity may, therefore, be given to the assessee to establish his case on the issue by sending the matter to the Assessing Officer. Keeping in view all the facts of the case, I find merit in the contention of the ld. counsel for the assessee. I accordingly consider it fair and proper and in the interest of justice to set aside the impugned order of the ld. CIT(Appeals) on the issue under consideration and restore the matter to the file of the Assessing Officer for giving one more opportunity to the assessee to support and substantiate his case on the issue of commission.

In the result, the appeal filed by the assessee is treated as allowed for statistical purposes. Order pronounced in the open Court on October 04, 2016.