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The Tax PublishersITA No. 3182/Ahd/2014
2021 TaxPub(DT) 0094 (Ahd-Trib)INCOME TAX ACT, 1961
Section 40(a)(i) Section 195
Where AO disallowed commission expenses for non-compliance of withholding taxes obligations allegedly cast under section 195 and CIT(A) endorsed the disallowance on an altogether different pedestal of genuineness of the expenses, in absence of any discussion on the aspects of bona fides of commission payments on which heavy impetus was placed by the CIT(A), entire issue was restored back to the file of AO for de novo examination.
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Business disallowance under section 40(a)(i) - Validity - Absence of any discussion on the aspects of bona fides of commission payments -
Assessee company was engaged in trading and export of cotton and other types of yarns. AO disallowed commission expenses for non-compliance of withholding taxes obligations allegedly cast under section 195. CIT(A) endorsed the disallowance on an altogether different pedestal of genuineness of the expenses. Assessee submitted additional evidences before the Tribunal to support the bona fides of the commission payments. Held: In absence of any discussion on the aspects of bona fides of commission payments on which heavy impetus was placed by the CIT(A), it was expedient to restore the entire issue back to the file of AO for de novo examination in accordance with law. It shall be open to the assessee to place all relevant evidences to justify the bona fides and genuineness of commission expenses in question as well as the reason for non-deduction of tax on such commission payments having regard to the provisions of section 195.
REFERRED :
FAVOUR : Matter remanded.
A.Y. : 2011-12
IN THE ITAT, AHMEDABAD BENCH
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