COMMISSIONER OF INCOME TAX Vs. TANDON AND MAHENDRA

JUDGEMENT

(1.) The appeal by the revenue under Section 260-A of the Income Tax Act, 1961 arises from a decision of the Income Tax Appellate Tribunal dated 24 October 2013. The Assessment Year to which the appeal relates is AY-2007-08.

(2.) The Revenue has raised the following questions of law:-

(3.) The assessee is a firm of Chartered Accountants. It had commission receipts amounting to Rs.73,28,868/-. To earn the said commission, the assessee paid an amount of Rs.51,27,815/- to Tapasya Projects Ltd. ('TPL'). While paying the commission, the assessee did not deduct tax at source under Section 194H. The assessee submitted, on a query, a reply together with details of the payment and a copy of the agreement with TPL. The JCIT, Range-5, Kanpur called for the assessment records and passed an order under Section 144-A on 23 December 2009 directing a dis-allowance of Rs.51,27,815/-, which was the commission paid to TPL, and ordered that it should be added back to the income of the assessee under Section 40(a)(ia). The Assessing Officer thereupon, added back the amount to the income of the assessee.