AI Structured Summary
Not yet generated for this judgment
Judgment
Per Renu Jauhri, Accountant Member:
This appeal by the assessee is directed against the order dated 12.09.2025 of the National Faceless Appeal Centre (NFAC), Delhi, [hereinafter referred to as the ‘Ld. CIT(A)] arising out of the Assessment Order dated 06.04.2021 passed under section 144 r.w.s. 143(3A) & 143(3B) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) by the NFAC, Delhi (hereinafter referred to as the ‘AO’) pertaining to Assessment Years (A.Y.) 2018-19.
Grounds of appeal filed by the Assessee are reproduced as under:
“1.That on the facts and in the circumstances of the case, the Ld. CIT(A) erred in law and on facts in upholding the ex-parte assessment framed u/s 144 of the Income-tax Act, 1961 without appreciating that the Appellant had duly submitted multiple written submissions along with supporting documents during the appellate proceedings.
2.That the Ld. CIT(A) has grossly erred in disposing of the appeal without considering the evidences, explanations and documentary details furnished by the Appellant in response to various notices during the appellate proceedings. The order is non-speaking, perverse and liable to be quashed.
3.That the Ld CIT(A) erred in confirming the disallowance of ₹50,56,374/- out of commission expenses merely on the basis of percentage comparison and estimation, ignoring the actual details of commission payments, TDS deduction & deposit, confirmations and other evidences submitted by the Appellant.
4.That the Ld. CIT(A) failed to appreciate that commission expenses were incurred wholly and exclusively for the purposes of business and that the AO had no basis to resort to estimation by applying an arbitrary average percentage of 44.90%.
5.That the Ld. CIT(A) erred in law in holding that the Appellant failed to furnish necessary evidences, whereas detailed submissions dated 22.11.2023, 09.03.2024, 14.03.2024, 27 03.2024, 02.03.2025, 23.06.2025 and 30.07.2025 were duly filed and placed on record during appellate proceedings but were completely ignored
6.That the Ld. CIT(A) erred in concluding that TDS deduction does not establish genuineness of expenditure, without appreciating that the burden shifts to the Department once the assessee furnishes primary evidences including names of agents, TDS details, commission workings and business rationale, all of which were ignored.
7.That the Ld. CIT(A) erred in rejecting the submissions filed by the appellant without giving an opportunity to cross-verify facts or evidence, and is a reproduction of AO's order without any independent adjudication or analysis, thereby violating principles of natural justice.
8.That the assessment and confirmation of addition solely on estimation without rejecting books of account u/s 145(3) is bad in law and liable to be deleted.
9.That the Appellant craves leave to add, amend, modify or withdraw any ground of appeal at the time of hearing.”
Brief facts of the case are that the assessee filed its return for A.Y. 2018-19 on 25.10.2018 declaring income of Rs. 8,03,020/-. The case was selected for scrutiny and notices u/s 143(2) & 142(1) were issued to the assessee. As no compliance was made by the assessee to any of the notices, the assessment was completed exparte vide order u/s 144 r.w.s. 143(3A) & 143(3B) dated 06.04.2021 at an income of Rs. 58,59,390/- after making addition of Rs. 50,56,374/- on account of excessive commission expenses disallowed.
Aggrieved, the assessee preferred an appeal before the Ld. CIT(A). As the assessee did not submit the requisite evidences in support of commission expenses claimed by it, the appeal was dismissed vide order dated 12.09.2025. Further aggrieved, the assessee is in appeal before the Tribunal.
We have heard the rival submissions and perused the material available on record. In the interest of justice, we deem it appropriate to give one more opportunity to the assessee to furnish supporting evidences in support of its claim of commission expenses.
Accordingly, the matter is restored to the AO for fresh consideration after giving due opportunity to the assessee. The assessee is also directed to make necessary compliance before the AO.
In the result, the appeal of the assessee is allowed for statistical purposes.