D.b.income Tax Appeal v. M/S Ashiana Ispat Ltd

IN THE HIGH COURT OF JUDICATURE FORRAJASTHAN BENCH AT JAIPUR D.B.INCOME TAX APPEAL NO. 95 / 2015PRINCIPAL COMMISSIONER OF I T(CENTRAL) ----Appellant Versus M/S ASHIANA ISPAT LTD ----RespondentConnected With D.B.INCOME TAX APPEAL No. 89 / 2015 PRINCIPAL COMMISSIONER OF I T(CENTRAL) ----Appellant VersusM/S ASHIANA ISPAT LTD ----Respondent D.B.INCOME TAX APPEAL No. 91 / 2015 PRINCIPAL COMMISSIONER OF I T(CENTRAL) ----Appellant VersusM/S ASHIANA ISPAT LTD ----Respondent D.B.INCOME TAX APPEAL No. 93 / 2015 PRINCIPAL COMMISSIONER OF I T(CENTRAL) ----Appellant VersusM/S ASHIANA ISPAT LTD ----Respondent D.B.INCOME TAX APPEAL No. 94 / 2015 PRINCIPAL COMMISSIONER OF I T(CENTRAL) ----Appellant Versus M/S ASHIANA ISPAT LTD ----Respondent D.B.INCOME TAX APPEAL No. 73 / 2016 PRINCIPAL COMMISSIONER OF I T ALWAR ----Appellant Versus M/S ASHIANA ISPAT LTD BHIWADI (ALWAR) ----Respondent __________________________________________ For Appellant :Mr. Anil Mehta, Mrs. Parinitoo Jain For Respondents :Vivek Dangi __________________________________________ HON'BLE MR. JUSTICE K.S.JHAVERI HON'BLE MR. JUSTICE DINESH MEHTA Judgment Per Hon’ble Mr. Jhaveri, J.29/11/2016 1. By way of these appeals, the department hasassailed the judgment & order of the Tribunal wherebythe Tribunal has allowed the appeal preferred by theassessee and dismissed the appeal preferred by thedepartment. 2.All these appeals involved common questions of law and facts, hence, are decided by this commonjudgment. However, the facts of Income Tax AppealNo. 95/2015 are taken up for consideration. 3.The assessee is engaged in the businessmanufacturing and trading of TMT Bars and MSIngots. The assessee filed return of income on27/9/2010 and a notice u/s 143(2) was issued forcarrying out scrutiny assessment. It was found by theAssessing Officer that the assessee had claimedexpenses under the head brokerage and commissionfor Rs. 95,44,810/-. The assessee did not produceany commission agent for examination but it filed acopy of agreement with broker and their ledgeraccounts, names and addresses. Again the AssessingOfficer required the assessee to produce the person towhom commission was paid but the assesseecommunicated that commission was paid on the salesto the associate concerns like RMIL. After examinationof details it was found by the Assessing Officer thatthe one’s to whom such commission payment wasmade, the respective accounts of the broker werecredited by the brokerage amount on the last day ofthe accounting year and the payments were made inthe next year. The bills were raised by the brokers onthe first day of accounting year or in the last month ofthe accounting year. On the sale bill name of the broker was not appearing, also commission was paidto some ladies who were the relatives/ wives ofbrokers. Hence, considering the fact regardingpayment of commission, it was held that no serviceswere rendered by the brokers to warrant anycommission so the payment made could not be provedto have been expended for the purpose of business ofthe assessee and hence the commission paid for Rs.95,44,810/- was disallowed by the Assessing Officervide order dated 31/3/2013. 4.Counsel for the appellant contended that thebrokerage & commission which was paid by theappellant for the same year was not held to begenuine transaction therefore, AO added the saidamount in assessee's income. CIT(A) has partlyallowed the appeal and has not allowed some of thededuction of commission & brokerage paid. 4.Counsel for the appellant contended that thebrokerage & commission which was paid by theappellant for the same year was not held to begenuine transaction therefore, AO added the saidamount in assessee's income. CIT(A) has partlyallowed the appeal and has not allowed some of thededuction of commission & brokerage paid. 5.Taking into consideration the details which werefurnished regarding copy of agreement, confirmationsand deduction of TDS, the recipient had PAN numbersand assessee has established they have renderedservices to provide the customers and payment wasmade by cheque, in our view, the view taken by theTribunal is just and proper. No substantial question oflaw arises in theses appeal. 6.The appeals are devoid of merit and deserve to be dismissed. The same are dismissed A copy of this order be placed in each file. (DINESH MEHTA)J. (K.S.JHAVERI)J.