Itta/746/2014 Of The Commissioner Of Income Tax-Iii v. M/S. Murari Trading Company

THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTISENGUPTA AND THE HON’BLE SRI JUSTICE SANJAY KUMAR I.T.T.A. No. 746 of 2014 DATED:21.01.2015 Between:The Commissioner of Income Tax-III,Hyderabad.And … Appellant M/s. Murari Trading Company,Hyderabad. ….Respondent THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTISENGUPTA AND THE HON’BLE SRI JUSTICE SANJAY KUMAR I.T.T.A. No. 746 of 2014 Judgment:(per the Hon’ble the Chief Justice Sri Kalyan Jyoti Sengupta) This appeal is sought to be preferred and admitted againstthe judgment and order of the learned Tribunal dated 23.7.2009 bythe Revenue, however, without suggesting any question of law. On a perusal of the impugned judgment and order of thelearned Tribunal, we find that the learned Tribunal found that theassessee claimed deduction on account of payment ofcommission to the sub-agent. This claim of deduction wasdisallowed by the Assessing Officer as well as the Commissionerof Income Tax (Appeals), on appeal being preferred. Hence, theassessee approached the learned Tribunal, which reversed, afterappreciation of fact and taking note of the agreements andmaterials placed before it and held that the factum of payment ofcommission by the assessee to the sub-agent is established.Hence, it has allowed the deduction. Mr. B. Narasimha Sarma, learned counsel appearing for theRevenue in the aforesaid background facts and the decision statesthat it was not proper for the Tribunal to upset the finding of boththe authorities while deciding the issue. We are unable to accept his argument as we notice that the learned Tribunal has found that there has been no dispute asregards the agreement between the assessee and sub-agent forrendering services and there is no dispute that the sub-agent isnot a fictitious body and it is a functional one and the Tribunalthought that since the sub-agent was systematically rendering theservices, it cannot be said that they are the loss makingcompanies. So, such claim of deduction is nothing but a step todeprive the revenue and if not to defraud the revenue. We think that the learned Tribunal has correctly come to afact finding basing on the materials that the relationship ofassessee and the sub-gent is established for rendering businessservices. Therefore, this payment of commission is a genuineone particularly when the agreement was not questioned as to itsgenuinity. The Tribunal’s fact findings cannot be interfered withby us in the absence of serious allegations of perversity and thisfact finding is really the basis of granting deduction. We therefore do not find any element of law for admission ofthe appeal. The appeal is accordingly dismissed. Consequently, the miscellaneous applications, if anypending, shall also stand closed. No order as to costs. __________________ K.J. SENGUPTA, CJ _________________ SANJAY KUMAR, J 21[st] January, 2015 Pnb