IN INCOME TAX APPELLATE TRIBUNAL, BENCH, KOLKATA Before Shri Waseem Ahmed, Accountant Member and Shri S.S.Viswanethra Ravi, Judicial Member I.T.A. No. 1376/KOL/ 2013 A.Y: 2003-04 I.T.A. No. 1377/KOL/ 2013 A.Y: 2004-05 DCIT, Cir-3(1), Kolkata Vs. M/s. Jalan Infosystem Pvt. Ltd PAN: AABCJ 2167-P (Appellant) (Respondent) Appearances by: Shri Pradip Mondal, JCIT, Sr. D.R for Revenue Shri Subash Agarwal, Advocate, Ld.AR for Assessee Date of hearing : 09-08-2016 Date of pronouncement : 21-09-2016 O R D E R Per Shri S.S. Viswanethra Ravi :- Both appeals filed by Revenue are directed against separate orders of Commissioner of Income Tax(Appeals)-VIII, Kolkata dated 06-02-2013 and 20-02-2013 for assessment years 2003-04 and 2004-05 respectively. ITA No. 1376/Kol/2013 AY 2003-04 of Revenue 2. In this appeal, revenue has raised following ground:-. 3. only issue to be adjudicated in this appeal is as to whether CIT-A justified in deleting amount of Rs.55,92,150/- paid towards sales commission in facts and circumstances of case. 4. At outset, we observed that Assessee filed additional evidence before CIT-A in support of its claim. CIT-A sought remand report from AO. AO examined such additional documents and made no adverse inference against such documents. relevant portion of remand report is reproduced herein below:- Since appellant furnished some additional evidences in support of this issue of appeal which were not produced before AO during assessment proceedings, those were sent to AO for his verification and comments. In response of same, AO has sent remand report. relevant portion of remand report is reproduced below:- "On receiving your first letter my predecessor-in-office fixed case for hearing and subsequently by me on my taking over this charge. In response Shri G.L. Saraogi, Adv. A/R of assessee company appeared from time to time and produced evidences in support of his claim. explanations and documentary evidences so produced were examined. On examination of same it was observed that assessee company has furnished some fresh evidences before your goodself which could not be produced before A.O. before passing order u/s143(3) dated 14.12.2007. Since, there was no specific direction U/S 250(4) in instant case, therefore, inquires are restricted only to fresh evidence that were produced before your goodself and not before A.O. Followings are evidence which were examined. A.Y.2003-04 (i) Details of statements of booking, partywise and Monthwise, through M/sJawala Steels (P) Ltd. (ii) Deed of agreements with M/s. Jawala Steels (P) Ltd. (iii) Proof of speed post. (iv) Copy of letter sent to M/s. Jawala Steels (P) Ltd. (v) Copy of letter to Addl CIT. Range-3/Kol, requesting to furnish certain documents. ITA Nos.1376 & 1377/Kol/13 M/s. Jalan Infosystem P.Ltd 2 (vi) Copy of Ledger account of M/s. Jawala Steels (P) Ltd. in books of assessee. (vii) Bank statements as proof of payments of commission (viii) Confirmation from M/s. Jawala Steels (P) Ltd. During A.Y. 2003-04 assessee company claimed to have paid commission of Rs.55,92,150 to M/s. Jawala Steels(p) Ltd towards collecting order from various customers on behalf of assessee company, resulting sale of 74562 pieces of Nokia sets M/s. Jawala Steels(P) Ltd has issued debit note for said agreement, ledger copy showing dates of payments through bank supported by bank statements, month and party wise booking of mobile sets were examined and no adverse interference could be made on these documents." 5. CIT-A examined remand report, where AO verified agreement, ledger copy showing dates of payments through bank supported by bank statements, month and party wise booking of mobile sets M/s. Jawala Steels(P) Ltd and made no adverse remarks. Accordingly deleted addition made on account of sales commission paid at Rs. 55,92,150/-. relevant portion of which is reproduced herein below: After carefully considering submission along with supporting evidences furnished & case laws relied upon on behalf of appellant, perusing facts of case including impugned assessment order, contents of Remand Report and other materials brought on record, it is held that action of AO in making disallowance of claim of sales commission paid at Rs. 55,92,150 to M/s. Jawala Steelst (p) Ltd by appellant is not justified and hence same cannot be sustained. Thus, addition so made by AO is hereby directed to be deleted and this ground of appeal is allowed. 6. We find that under remand proceedings AO examined documents at S.L No. (i) to (viii) mentioned therein at page 7 of order of CIT-A. Admittedly, said documents were not before AO at time of hearing. We find that AO did not make any adverse remark on such documents and in view of same, we dismiss sole ground raised by revenue in ITA No. 1376/Kol/2013 for A.Y 2003-04. ITA Nos.1376 & 1377/Kol/13 M/s. Jalan Infosystem P.Ltd 3 7. appeal of revenue in ITA No. 1376/Kol/2013 is dismissed. ITA No.1377/Kol/2013 A.Y 2004-05 of Revenue) 8. In this appeal, Revenue has raised following ground:- 9. only issue to be adjudicated is as to whether CIT-A justified in deleting amount of Rs.63,98,815/- paid towards sales commission in facts and circumstances of case. 10. At outset, we observed that Assessee filed additional evidence before CIT-A in support of its claim. AO examined such additional documents and made no adverse inference against such documents. relevant portion of remand report is reproduced herein below:- Since appellant furnished some additional evidences in support of this issue of appeal which were not produced before AO during assessment proceedings, those were sent to AO for his verification and comments. In response of same, AO has sent remand report. relevant portion of remand report is reproduced below:- "On receiving your first letter my predecessor-in-office fixed case for hearing and subsequently by me on my taking over this charge. In response Shri G.L. Saraogi, Adv. A/R of assessee company appeared from time to time and produced evidences in support of his claim. explanations and documentary evidences so produced were examined. On examination of same it was observed that assessee company has furnished some fresh evidences before your goodself which could not be produced before A.O. before passing order u/s143(3) dated 14.12.2007. Since, there was no specific direction u/s 250(4) in instant case, therefore, inquires are restricted only to fresh evidence that were produced before your goodself and not before A.O. During A.Y : 2004-05, assessee company paid commission to following parties:- 1) M/s. Jawala Streets (P) Ltd Rs. 51,15,450 ITA Nos.1376 & 1377/Kol/13 M/s. Jalan Infosystem P.Ltd 4 2) M/s. Goldayan Trading (P) Ltd Rs.12,04,165 3) Sri Rajesh Kumar Jain Rs. 79,200 ------------------- Rs.63,98,815 ------------------ Copies of bills, copies of agreement/appointment letter, ledger copies, details of month wise books of mobile sets were produced for all three parties and they were examined and no adverse interference could be made on these documents. Tax has been deducted on commission so paid by assessee company. 11. CIT-A examined remand report, where AO verified agreement/appointment letter, ledger copy, details of month wise books of mobile sets of all three parties and made no adverse remarks. Accordingly deleted addition made on account of sales commission paid at Rs.63,98,815. relevant portion of which is reproduced herein below: After carefully considering submission along with supporting evidences furnished & case laws relied upon on behalf of appellant, perusing facts of case including impugned assessment order, contents of Remand Report & rejoinder to remand report furnished by appellant and other materials brought on record, it is held that action of AO in making disallowance of claim of sales commission amounting to Rs.63,98,815/- paid to M/s. Jawala Steels(p) Ltd, M/s. Goldayan Trading (P) Ltd and Sri Rajesh Kumar Jain by appellant is not justified and hence same cannot be sustained. Thus, addition so made by AO is hereby directed to be deleted and this ground of appeal is allowed. 12. We find that under remand proceedings AO examined documents available/recorded at page 7 of order of CIT-A. Admittedly, said documents were not before AO at time of hearing. We find that AO did not make any adverse remark on such documents and in view of same, we dismiss sole ground raised by Revenue in ITA No. 1377/Kol/2013 for A.Y 2004-05. ITA Nos.1376 & 1377/Kol/13 M/s. Jalan Infosystem P.Ltd 5 13. In result, both appeals filed by Revenue are dismissed. Order Pronounced in Open Court on 21 s t September,2016. Sd/- Sd/- Waseem Ahmed S.S.Viswanethra Ravi ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 21/ 09/2016 Copy of order forwarded to:- 1. Appellant/Departmen: DCIT, Circle-7, Kolkata P-7 Chowringhee Square, 5th Floor, Room No.15, Kolkata-69. 2. Respondent/Assessee: M/s. Jalan Infosystem Pvt. Ltd 26 Dimple Court, Shakespeare Sarani, Kolkata-17. 3. CIT 4. CIT(A) 5. Departmental Representative 6. Guard File By order etc Assistant Registrar Income Tax Appellate Tribunal Kolkata benches, Kolkata ** PRADIP SPS ITA Nos.1376 & 1377/Kol/13 M/s. Jalan Infosystem P.Ltd 6 DCIT , Cir-3(1), Kolkata v. M/s. Jalan Infosystem Pvt. Ltd