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Showing contexts for: performance linked bonus in Commissioner Of Income Tax Delhi-Iv vs International Travel House Ltd. on 13 September, 2010Matching Fragments
3. After the assessment order was passed, the Commissioner of Income Tax examined the record and noticed that the assessment order was prima facie erroneous and prejudicial to the interests of the revenue and accordingly, issued show cause notice under Section 263 of the Act. The assessee filed its show cause / reply. It was contended by the assessee that the assessee had merely claimed credit of TDS; that the assessee had booked tickets in various airlines for its customers for which it received commission from the airlines @ 7% on international air tickets and 5% on domestic air tickets purchased; that the assessee received performance linked bonus and overriding commission on sale of air tickets; that a part of the commission is passed on to the customers by way of discounts and the net commission was shown in the books of accounts and offered to tax by the assessee; and that the assessment made under Section 143 (3) of the Act was not erroneous and prejudicial to the interests of the revenue so as to attract any action under Section 263 of the Act. The Commissioner came to hold that as per the TDS certificate, the total amount credited was Rs.27,46,18,000/-. However, in the P&L account, the assessee had credited only Rs.11,93,39,485/- and that had led to a mistake committed by the assessing officer which had eventually resulted in underassessment of income to the extent of Rs.15,52,78,515/- for the assessment year 2003-04. The CIT had opined that in order to take a final view on the issue, further examination of books of accounts would be necessary which can be conducted by the assessing officer. Eventually, he set aside the assessment on the said limited point and directed the assessing officer to decide the claim of the assessee company for regarding the payment of commission passed on to the customers by way of discounts / handling charges and to verify the net commission transferred to P&L account afresh as per law and after giving reasonable opportunity to the assessee company of being heard.