COMMISSIONER OF INCOME-TAX Vs. SUPREME AND CO.

JUDGEMENT

(1.) AFTER hearing the learned advocates for the parties and perusing the application for condonation of delay, we are satisfied with the grounds stated in the petition. Accordingly, the delay is condoned. The application under Section 5 of the Limitation Act is allowed. GA No. 1473 of 2008 is thus disposed of.

(2.) WE now take up the application for admission of appeal. We have heard learned Advocates for the parties. We have also perused the order passed by the Tribunal. It appears that the Tribunal has specifically held as follows: 9. The Id. DR relied on the remand report of the Assessing Officer and contended that the disallowance made by the Assessing Officer was justified. The Id. DR, however, could not assail the argument of the Id. A/R that no item of expenditure under the head commission was found unverifiable. 10. We have considered the rival submissions made by both the sides and gone through the records. Prima facie the Assessing Officer neither in the original settlement nor in the proceedings for the remand report has pointed out any defect in the maintenance of the accounts and the details by the assessee with regard to the payments of commission to the foreign agents. 10.1 It is a fact that all relevant details have been before the lower authorities and have been examined particularly with reference to remand proceedings. The Id. CIT(A) however, proceeded on the basis that claim of the assessee with regard to the payments of Brokerage and Commission has gone up during the year under appeal though compared to the assessment year 2000 -01 where the commission payment was Rs. 157.86 lakhs on turnover of Rs. 2,269.82 lakhs, the payment of commission during the year under appeal was only Rs. 135.24 lakhs on turnover of Rs. 2,992.93 lakhs [page 26 of the CIT(A)'s order]. But then it is also seen that the Id. CIT(A) erred in drawing the average of three years of payment of commission which in fact comes to Rs. 118.74 lakhs in place of Rs. 71.00 lakhs noted by the CIT(A). Further, it is seen that the percentage of average commission on average sales of the past three years comes to 5 per cent. During the year under appeal, payment of commission is Rs. 135.24 lacs on total sales of Rs. 2,292.93 lakhs which is less than 5 per cent, After going through the facts on record and the submissions made by the rival parties, in our opinion no disallowance out of the claim made by the assessee with regard to the payment of brokerage and commission was justified. Accordingly, we delete the disallowance of Rs. 64,00,000 sustained by the CIT(A).

(3.) WE also express the same opinion as expressed by the Tribunal. We do not find any reason to interfere with the order so passed by the learned Tribunal nor the order so passed by the learned Tribunal suffers from any legal infirmity nor we find that any substantial question of law is involved in this appeal. Hence, the appeal being ITA No. 319 of 2008 is dismissed.