Commissioner Of Income-Tax, Calcutta, Now West Bengal Iii v. Imperial Chemical Industries (India) Private Ltd

Section: CONCLUSION COMMISSIONER OF INCOME·TAX, CALCUTTA, NOW WEST BENGAL m IMPERIAL CHEMICAL INDUSTRIES (INDIA) PRIVATE LTD. February 20, 1969 (J. C. SHAH, V. RAMASWAMI AND A. N. GROVER; JJ.] Indian Income-tax Act, 1922, ss. 3, 10(2) (xv) and 66(1)-Assessee appointed sole selling agent of principal-Compensation paid to former selling agents through accounts of assessee--Compensation paid through assessee's accounts whether deductible expenditure-Payment whether expenditure IG'id out for purposes of business-Payment whether urtdtr overriding title-Tribunal's finding of fact that compensation was not paid by assessee under any agreement with principal cannot be interfered with by High Court when question not referred to it. The Imperial Chemical Industries (Export) Glasgow was a subsidiary of Imperial Chemical ~dustries London. With effect from 1st April 1948 the former terminated the services of four selling agents in India and in their 'pface ·appointed the. respondent company (another subsidiary of the Im pert al Chemiclll Industries, London) as their sole selling agents. The four former selling agents were to be paid compensation fo~ the termina-tion of their services and this was done through the accounts of the res-pondent. In its income returns for the years 1949-50, 1950..51, 1951-52 and 1952-53 the respondent showed as its income the net amount of com-mission arrived at after deducting from the gross commission the compen· sation paid to the former selling agents. The Income-tax Officer in his order for the year 1951-52 held that the said deductions were not permis-sible. His order was confirmed by the Appellate Assistant Commissioner and the Income-tax Appellate Tribunal. The Tribunal held that there was no agreement between the Imperial Chemical Industries (Export) Glasgow and the respondent company casting on the latter the liability to pay the compensation to the former selling agents out of the commission earned by it; the Tribunal further said that even if there was an agreement it was not acted upon. In reference under s. 66( I) of the Indian Income-tax Act, 1922 the lligh Court took the opposite view and held that the claim made by the respondent company was allowable. The revenue appealed to this Court. The questions that fell for consideration were : (i) whether the High Court was justified in interferin2 with the Tribunal's finding of fact on a question not referred to it; (ii) whether the compensation amounts paid by the resPond.ent to the former selling agent• were expendi-ture laid out wholly and exclusively for the purpose of business; (iii) whether the income in question was diverted before it reached the respon-dent by virtue of an overriding title. HELD : (i) It is well-established that the High Court is not a Court of Appeal in a reference under s. 66( I) of the Act and it is not open to the High Court in such a reference to embark upon a reappraisal of the evidence and to arrive at findings of fact contrary to those of the Appellate' Tribunal. It is the duty of the High Court while hearing the reference to confine itself to the facts as foand by the Appellate Tribunal and to answer the question of law in the context of those facts. It is true that the finding of fact will be defective in law if there is no evidence A to support it or if the finding is perverse. But in the hearing of a re-ference under s. 66(1) Of the Act it is not open to the assessee. to challenge such a finding of fact unless he has applied for the reference of the speoific question under s. 66( 1). [809 B-D] Mant Mga, BARA, Ta aeaAT TATA III. aAtAa graifvaa Sfana seeecia (gftgat) srgae fafacs (Commissioner of Income-tax, Calcutta, now West Bengal Ii] Imperial Chemical Industries (India) Private Ltd.)(20 wxazt, 1969) (sa1o Wo to ME, Ato WaaTAt WIT To Uo WA) gfozaa gma zaq daz,1922 urea 3,10(2)(xv) ak66(1)—-faatfedtoafensrTHATAfaxa-afaaatfaafeataat—aagafasaafasatat wt sfaac faaiftat & Saratat niga fear car—-aat tart data aizaiy % sataat H fag afaeaeasay 2 ?—aur dae mearttal ae adie g?—afearn F avaaranit ca facng #, fa faaifzat a ofaazt ar dea asa % aragu feat were B neta sat feat ar, sea eatarea geaaa At Feaaa wats ag set saat fadfina vet feat vat att aiifead afana goed(uaatz), warmerifiaaafarqueeaiy, wear aT ANAT at) qanfaad A Lada,1948 A HIRI H AMfaxa-afamaiat et dard cdafsa et st ax saw cart Te FeTdT BraaT(zehfzaa Hana qosedty, wea Bl UF eT AAG) BT AT THATA eT-afanal ® eg i Page fear) gags arti fama-afaraiat at wast arae aqaqra % fac gfanc feat ara ar ait ae HIa geaat H Aarat at Aha FRAT TAT) AT 1949-50, 1950-51, 1951-52 wiz 1952-53 ® faayaatygraz-faavhuat 4 sear a ue arreo A attra a az ag <aq efea atWY aH Stra Fa wags fewar-afnatal ey dea ofant a ae aHvar sal at1 wraHe afrart Fag 1951-52 % feu age gies F agofufraifea fear fe saa azifaat waste agt awere og (attr) akmat atta ofa a Tas area at gfe Btaferum a az ofafratfeafear fe sriifmaa sfana zosedta (utes), varaa ale sea weg B ahsYar arg wut sgl ara oeacafad ox ag afar cia fe az at giacofaa adi Fa yard fasa-afanaiat ar ofaac ar aera at;afeae4 ag at ner fe af ere Hux at aT Gas agary Hy adi fear aay) zfeargeay faq taz, 1922 Ht are 66(1) # weala fade A sea qa a sqsfaga afecale aoarar ate ae ufaftattes Pear fae cerat weqay gree Pramat arat Hye fa aA aT|e1 Uses TAIze aTOH ada Ft7é\ faaratta seat 7S:(i) FAT VST ATTTATFT, RA get Te aT BAfafa agl fear mar, afanw FH aea ataedl fasaeg F qraeq a geqatq HATraraifad a; (ii) ar seal gree yar faaa-afasatal el aea sfaae aTTHY Dal 2qq , aT arqara: We waeag: BITaTe FH AAT & faa afyeqeaat; (iii) eat saaaat ara Peat weareiat es B arare az gerdh a ara wea174 di aqiataa Hz a as at) ufafaaifza—(i)az gzativa2fe seaeararaa atafara ayare 66(1) # aeita fazer Fadia eqrarag adiZ WIt Tea varmiay Za ala Ffau cada adi @ fe ag ta fade A area Hr gay eating St WIR aeHR BRfang fant ot adie afaaza & facaat F sfage atte faze ay aaargHF THA GIT eqIAIATT Hl AZ HIzA Zlal 2 fH az asssr ataafaHrygre qe ae qeat aH gi atfas we ale sa aeTi H aay a fafa Fgsqaszat 2) ag aa 3 fe af ae7 & feomd a aada wea arar FIR ated a FTat facag fae (perverse) ai at az fafa ar afeFH afeqarstars fRegafafaaa ai aver 66(1) * wea fade at gaarg H angfaegifedt acyFH0a frond at gale aa a faa aa ae cada sat ginr we awfHgaaart 66(1) & sata ea fafatacz gua & fata # fau oraaa vet fara 2 sega aaa FW frsifedt 3 arer 66(1) # wea aia oaza FRUITOFatarg a atta afsaun a freag ar fafaqraar & faqa y meq fea eT4 goat ar feeq ae get ata wa getseararareaa at fagfa az 502. geaaa ears fag was [1970] 1 380 fro Fe Rar aay ar alz sa seq HR araca H fraifest Ft eatra H art WAZ AATstat atfzc fe ag araayz wt drag1 fraifeah 4 aaa afafara aavi 66(2) & adia sea eararaya ag wa Hea ara Taz at feat fsaz oa fafafece seq & arara y arma HT fase ATG | Wa: SST ATATHAtate afgnz & aaa ag feo te ates ai gageaiead HR AIK ATTafgazm Hq faced a1 qiea BVH aaa AY fe aga edieHOH YAfana-ufaraiat a ofan ® aaa H fac aysBay wazadi ar, warTFfaaifear grr atar fear wa 2 ae afe are tar Hut ar al saw Aqare HYvz) PRor war|-|ot In the present case the assessee bad in its applications under s. 66(1) expressly raised the question about the validity of the finding of the Appellate Tribunal as regards the agreement but the question was not B referred by the Appellate Tribunal to the High Court and the contention of the assessee with regard to the question must be deemed to have been .rejected. The assessee did not thereafter move the High Court under s. 66(2) of the Act requiring it to call for a statement of the case on that specific question. The High Court was therefore in error in embarking upon a reappraisal of the evidence before the Appellate Tribunal and setting aside the finding of the Appellate Tribunal that there was no c agreement as claimed by the assessee for the payment of compensation to the former selling a~ents out of its own commission and that if there was such an agreement it was not acted upon. [809 F-H] India Cements Ltd. v. Commissioner of Income-tax, 60 I.T.R. 52, Commissioner of Income-tax v. Sri Meenakshi Mills Ltd., 63 J.T.R. 609 and Commissioner of Income-tax, Bombay City 1 v. Greaves Cotton cl Co. Ltd., 68 I.T.R. 200, applied. D (ii) In the absence of proof of the exact terms and condit.ions of the agreement it was not possible to accept the argument that the amount paid as compensation to the ex-agents was an 'expenditure laid out wholly and exclusively for !he purpose of the business under s. 10(2) (xv) of the Act. [810 DJ (iii) The assessee's documents suggested that the payment of compen-E sation was the exclusive liability of the I.C.I. (Exports) Ltd. and the assessee was not under a legal obligation to pay the amount of compensa~ tion to the outgoing agents. It was not established that the payment of compensation was by an ove'rriding title created either by the Act of the parties or by the operation of law. An obligation to apply the income in a particular way before it is received by the assessee or before it has accrued dr arisen to the assessee results in the diversion of income. An obligation to apply income accrued, arisen Or received amounts merely F to the apportionment of income and the income so applied is not deducti-ble. The true test for the application of the rule of diversion of income by an overriding title is whether the amount sought to be deducted in truth never reached the assessee as his income. [810 H-811 HJ Raja Bejoy Singh Dudhuria v. Commissioner of Income-tax, [1933] 1 I.T.R. 135, P .. C. Mullick v. Commissioner of Income-tax, [1938] 6 I.T.R. 206 and Commissioner of Income-tax, Bombay City 11 v. Sitaldas G Tirathdas, 41 I.T.R. 367, applied. CML APPELLATE JURISDICTION: Civil Appeals Nos. 1549 to 1552 of 1968. Appeals from the judgment airld order dated September 28, 1964 of the Calcutta High Court in Income-tax Reference No. 18 H 1961. Sukumar Mitra, S. K. Aiyar, R. H. Dhebar, R. N. Sachthey and B. D. Sharma, for the appellant (in all the appeals). M. C. Chagla, T. A. Ramachandran and D. N. Gupta, for the respondent (in all the appeals) . The Judgment of the Court was delivered by Rama.swami, J. These appeals are brought by certificate from the judgment of the Calcutta High Court oated 28th September, 1964 in Income Tax Reference No. 18 of 1961. -sfesar ataeza fafazs aa miaat waza (India Cements Ltd.Is. Commissioner of Income tax,) 60 Algo eto Alto52; WAHT Bat-aatq atatatett faca fafate(Commissionerof Income-taxVs.SriMeenakshi Mills Ltd.), 63 a1Zo fo BIZo 609; FIX WHT mya, Argfadt-1 aaa diem wiza oes eget fefate-(Commissioncr of Income-tax,Bombay City-1 Ms, Greaves Cotton and Co, Ltd.),68 algo 210 HIZo 200|aq fan avy.a:| (ii) Fut & fafeas faaeaal ate wate aga Fe mara A fraifeataTSe zee BT eaTRIT HAT eae sel 2 fe yaTa afawatal a1 sfsaT F eIH azat wEe afafram ay art 10(2) (xv) ® wala‘aeTEa: a WATS:HITTToaT H fan afaered say ay _(iii) faatfeay at zearas ag efa azar 2 fa ofaee wr FatsTgo ato argo (waailz) fafazs ar mara aifaca at ale famtal alanateta frac att tae ar dary ate & fan fratiedtfeat fafa areaar # walaadi arag fag adi gar 2 fe ofaac ar sara frat 8a meardet zesaz Pear aaay ar Ty rarmittwry grey or Paha BR gaa Bre Aes SATet| feet ara at, sah 9a Peoag faaifed at greazt ar az faaifeat #1az4ya at gry zt, feat fafaee sarecaaaa TVA HT ATIT FT TARTUMT-aTaas Etat #| TDA, Seqa aT oea are ay Taaifaa HTT BT ATETATsig ® qarsa ara ay aie Hod Soc te sonifas aia azldt aa atlai Smead ge B agqare a7 F savada FB fagra aT any FA FFadi wa ag tear 3 fe ag ae wHa, Praat HzTaT al ara ay ait aT Te 2,arqa: faaifed) #9 TaeT aT % eq A wey agi gear 2 ar seat 2| wat fang fag gqzat sare ma Feared (Raja Bejoy Singh ~Dudhuaria Vs. Commissioner of Income Tax) (1933)J YTSo Zto HITo 135;Glo ato wae aaa araRt aigat (P.C MullickVs. Commissioner ofIncome Tax) (1938) 6 31% do ATXo 206; Alt WTF Waa, arazfazt Taay dtasara atczara (Commissionor of Income Tax, Bombay City-I Vs.©Sitaldas Tirathdas) 41 a1go dle WI%o 367 aly fay 7 t7.fafaer adtet afaarftat: 1968et deat 1549 & Bae 1552 aH FT,——-fafas ama|: 1961 ® armey faedeat18 H saVa Gey carat H TA!28 fraraz, 1964 ary fata ai ate ® fang aia3rare —oadtarat at ete &saatgeniefaa,UdoFe WAT,(aot aiiat #)«gto WH Fat, Wito WAo AAS A”dio Sto aT|Sogaat at watz awad Ute He BTA,elo To TAaRA(HT a Tay 7);atz Zo To WCF| ranma at frara eararfatia traearay + fear| —*aararfaafa ctrearet— F gdF 1961 R grace fades qeqr[8HO RARE Jew ara Farte 28 faaraz, 1964 am fata & fee gata AHt aT TE 2I geaat (faa ext ee gosta faaifedt wervar 2) wa H faafsaon szaz fafazes weadt2 iz fe aedifeaa Bfrae qoeedta, aeeT FT, FTfaaifedd at argat aocaft ara ad 2, amadi (subsidiary) 21 FratheatHT BITATTS Beta: caraat, Tawi (dyes), Paentert ale Ha way fHeAT Fata % fac, faarer fafanter ar ay gah seca fer arfeaat grat fear ara2 ate farer aiea H faa frat ara 3, urea 8 farr-afaratal * eT Rara azar| fe eedifeaa Sfaea zeeedig (vaadid), warad[fra cae 2am 564 sraaR aatsy faa afzat [1970] 1 Bao fre Geo The respondent (hereinafter called the assessee) is a private limited company incorporated in India a.nd is a subsidiary of the Imperial Chemical Industries, London, which holds the entire share capital of the assessee. The business of the assessee con-sists mainly of acting as selling agents in India for a large variety of goods such as chemicals, dyes, explosives etc., manufactured or purchased by its London principals and sold in· India. The Impe-rial Chemical Industries (Export) Glasgow [hereinafter referred to as the LC.I. (Export) Ltd.] is another subsidiary of LC.I. London which holds the entire share capital of LC.I. (Export) Ltd. The l.C.I. (Export) Ltd. had appointed as their selling agents in India four companies, viz., ( 1) Gillanders Arbuthnot & Co. Ltd., Calcutta, (2) Best & Co. Ltd., Madras, (3) Anglo-Thai Co. Ltd. Bombay and ( 4) Shaw Wallace & Co. Ltd. With effect from 1st April, 1948, the l.C.I. (Export) Ltd. terminated the services of the aforesaid selling agents and appointed the assessee as its sole selling agent. The I.C.I. (Export) Ltd. had agreed to pay to the former selling agents compensation at the rate of two fifth, two fifth and one and two fifths of the commission earned by the assessee for the three years from 1st April, 1948. The compensation was paid to the four companies through the accounts of the assessee. For this purpose the modus operandi adopted was as follows :-The compensatiQD. payable to the former agents was spread over a period of three years and on the assumption that the turnover was constant, the compensation payable to the selling agents was on an average, an amount equal to the I 1/15th of the commission earned by the assessee at the 1normal rates. In order to a•rive at the amount of commission to be credited to the assessee's profit and loss account each year the as•essee in the first place credited the commission account and debited the I.CI. (Export) Ltd. account with the full amount of compensation earned by it at normal rates on sales effected during the year. Next, the assessee transferred from the commission account to a special reserve account called the 'Exp[1]osives Ex-Airents Com-pensation Reserve Account', the proportion payable to the ex-agents as compensation, namely, II/15th (2/5+2/5+7l5= 11/5 x 1/3 = 11/15) (leaving 4/15th towards commissioo account) so that funds misi;ht be accumulated for payment to the four companies from time to time. C.I.T. v. IMPERIAL CHEMICAL LTD. (Ramaswami, J.) A The year of account of the assessee is from 1st October to 30th September every year. As a result of the above method of accounting, the following figures appeared in the assessee's books of accounts :- 564 TTT Algo Blo Also, (veqNz) fafate wer wT 2] argo Ato WTso areaHT, AT age Ao age (nzaTe) fafaes Ht arqer sig-gat area ear8,we gay AMAT21 fF aso Alo argo (aq) fafats % weaFH azsrafaay at, aatq (1) fseee mrazare vos agar fafatz, sane,(2)aez wos amrqdt fafaes, ware,(3)UralareFertfafazs,WrTE,wiz(4)ar aaa aos artfafaes,stoqfaaa-afasaiat&eq 8 fagaa feat arife wIgo alo aTFo (vast) fafazs4% qatsafasa-ofaeaist st Fad| aya, 1948 & aqgafaa Hz St ate featheal Ft goamana fasqafenat fag fear1feargoatoargo(aaadte)fafas ea ara qq agua zi at fe az qaaz fraa-afuratat #1 aa,1948 & 3 ag % fan, faatfedy gre sufsa ettaa F zt-qer-cta, Fazi-iaMT OH TAT -3zT Ta BT BTA wfaHe Hr Aare ETT| sa are HrafaTiFiafaaz ar aes faaifeat Sarat at aha Pear war ari ga saisafafarafafas sia-soreit aoare 1z t—qaadh afeasiat taza osfaee diaag at prarate # atz fear qatar ate zaman ae PRaTazT (turn over)wa aa at, feaa-afanatat at aaa ofan aaa ey Hoag weyar,faaifeat erer sararea avy oz soifsa eaters HL /1SBH gaat at)gearsaq faatfrar # ara ate aifa ara # orafaa feu art ae sataa a zen* gio a fraifed? = oz4 va eileay at vat ag ® aha feva faaat se paras att ot eufse far ar, at xaeR HT ahaa are HwaFUAT AIT’ JI Wigo Alo oro (vaTHz) fafutsFB a & faafaa Fearycae ara, faaifedt & qaqa aferatat et sfaax F eq H ae garwate 11/15 (2/54-2/5+ 7/S=1/S x 1/31/15)Ft (aaa ararae4/15 are et) Maa aa a we fag oft aH gates az fear ai“ExplosivesEx-AgentsCompensationReserve Account”(aaqcatfteyqaqa efaeat sfarz arefera stat)wgatarar, fat arti aerfaayayTAA-GHA WT Rayfan fafaat afaa a ar aH| faatizat ar aarag sfaad| wazaz # 30 faarax ae Fiat 2 For the assessment years 1949-50, 1950-51, 1951-52 and 1952-53 the assessee showed the net amounts of commission earn-ed on the selling agencies by the I.C.I. (Export) Ltd. adding a D foot note that the· amounts were arrived at after deducting the amount of compensation payable to the out-going agents. By his order dated 28th January, 1957 for the assessment year 1951-52 the Income Tax Officer held that the deductions were not pennis-sible. In an appeal preferred by the assessee the Appellate Assis-•ant Commissioner confirmed the assessment by his order dated E .<5th November, 1957. The assessee took the matter in further appeal to the Appellate Tribunal which dismissed the appeal. The Appellate Tribunal held that there was no justification for the ab-~ence of a written agreement between the I.C.I. (Export) Ltd. dl!d the assessee when the former selling agencies were terminated an '. the assessee was appointed as the sole selling agent. It was F ob.;erved that the assessee was not collecting any commission on behalf of the outgoing agents and it was not their legal obligation to pay compensation to the out-going agents. If the assessee was noi entitled to more than 3/5th of commission during the first two years, it should have credited that amount whereas the assessee had actually credited four-fifteenth on a notional basis which was not in consonance with the arrangement. The conclu-G sion reached by the App.ellate Tribunal was that "there was no agreement between the assessee and the I.C.I. (Export) Ltd, and if there was one it was not acted upon". It was held by the Appellate Tribunal' that the payment of compensation was not be-cacse of an overridin ~ title created either by the act of the parties or by operation of Jaw. At the instance of the assessee the following question of law wa,s referred to the High Court under section 66 ( 1 ) of the Income-Tax Act, 1922 (hereinafter called the Act) :- "Whether the inclusion by the Income Tax Officr.r of Rs. 2,03,503, Rs. 5,41,526, Rs. 5,29,284 and Rs. 4,00,052 in the assessment for the years 1949-50, 1950-51, 1951-52 and 1952-53, for relevant account-ing years ending the 30th Sept. 1948, 1949, 1950 and 1951 respectively in the computation of the total income of the assessee is justified and correct ?" The High Court answered the question in the negative in favour of the assessee holding that the inclusion of the amount of com-pensation in the total income of the assessee for the relevant assessment years was not justified. the relevant trata & ata ag ere ay fel asta, 1948 831 ard, 1951 aa at areasfac frathdt, a7t adiga & eq H Pea a Aceh a ar SHUT AL FT BANATwaar zt ate oa arava F ahora gaaz afemalat Ht aia aH HF draHomaT HBT HS1 adie afew a sa qall eaves az frare fear ar atkag za faeeg qe agar a! Pe ago dio wiFo (waste) fafats ate fraifediaT Hy RUTAAT ar aie fe HS Hut at ay eaH aaa HT aR Pearmar) aie afar a az war fe argo alo argo (uaade) fafates %arta 11 ard, 1947 ata ga fF eq F feaeva aie aa zaalera at, faahaeqata faatat ofanatat # faerie) a qgafea feat aat ari wRfaaa-afanal & eq & faatfedy a fagfa at atta 4 dia at a srarfa& za se far art are aetea F famtae gear FB araey F az altatayaa ae oF StacsaaB aIaIa Teal are aeraH ayaa (ata)B® awayTr faq at 1X maT BIg Hho Hse (uaaMe) falas % wears fewa-afupat eed & fraifedt at frafer a fanian arta ® ate act ate fan17 A) ca wTaTay A fantat afanatal e feo ok aa Halo al tay Isea aat Par nar st ate FT cosas feaifedl a aar-afeat F st wfaftest aang Ht agy 31) ag eaqare oe Aha sr a qza azWHET Ie BlyHzyHamer adra wy garare H ahora Ac fear qa ar we weg at ag Ta faaifedtger aTATS ag Gat-iala Fy ara eqee Hea Boo} cag sq ara H zagaia Paar ara ar car ay amar| ca ofefeafaat F atta afaeco ¥ ag ofafaulfea faar fe fraifeat ate argo dio argo ( naqqz) fafats ® arq angwae Tet ar ae ae ws Bar eu ar Ah a ah aqare ees acy far aarngewe 2 fh eq gsq ® qrary qe oda afgazm ar faery qeq grazed]RetartH facaq2 ate seq eqrmag a1zafaced #argeyFFataayT HT Hlafaeniz aay ar|aggtaitct 2fesey qrafafray at avr66(1) #winfateF adaaaraqwey Bmaiz va fary a ora eqmrag aq aa F fay eaaea agi 2 fe az areq aTgayeatnaet ale aed $04 faceg Sana a ada agai & facaGt Ffag att fazer at gears wea aay seq eqrqaT FT ag eaeT 2feag ata alae ge a aT aay am aay aH Sifea va aie sa aedt #aaa a A fafa s geal ar sattag aa a fe ale aeq # faewd ar andaHU AAT BIE arem ag 2 ar facaHq fawa (perverse) 2 at az fafa a shezHafeanr za1 freq afa'aan at ater 66 (1) # adia fata at qaqarsqagq faa aay a ta feng +] aad sqm fan ar ay caqeq aah z1aTHa TH OH JAF aver 66(1) # mera ca Pafatecs wea H feta F far aaea adt fear 2) efor alae fafats sary arene oraaa (1) He UTaTAT A AEafafaaifca feat fe fade F sea eqrorag at ger Boga fromahsy caterat at Bar arfee faa ox aha afsaca Wat at wie ae free H faq araTawy are cerere ar wre SPH ag arer 66(1) F wala WATT AIT Tea HOSAfacaat at gaa aatdt 21 afe arag erate aver 66(1) # ara Far ade,faa aor ® from ay fafarteaar & fava A ooet afaera BT A GoTaTAATa, Wea ata H asca war 2, al Ja ag eF aay) 3 fe ag Sea aTATama ag fatar at fe faced frat area4H yefua 31 wel WA Reeqaaa Ht wraee aaa TATA Bt Atatalt fea ferfaes (°) are aa aTgRAweaé fadt-l aay wien ater vos weal falnes (°) Fort feat1 Tamas & fratfedt 4 aver 66(1) B ada waa aaaa H, wUe H aeaea Hadaafaaco & frend 41 fafanerar % fra Foose afaeaaa wr A sera ar, fagag sea atte ofaneg gre sea eararaa a1 feat wet fear eat Wit BAgaa & araeg & fralfedi at atta Bart Ho aA aaa oaraifag fF FeaTaGT BT at ft we| fratfedt & aeaearg afafray at are 66(2) Faas seamrarag & ae ater Het araraaraas ae} far fe ag ga fafatace wea Faraea H arma ar feaco Hare| aa: sae WT H Bsa earaTaT a atta WheeHUT H aaa Aa Pou ag get Hr Gaye STH Mi aha alsa F FAfasad at ager ach qadt at fe vag tar wuz agat sar featSeeYo Vo Fa MT At Fo SHJo AeSAT F ATATATafanfad 2° aIecafe tar arg wut aT al sae MyATT Hla Tel fear aa’ of gimar ¥ az atta at 8 fr afe wuz firs adi Baar at a fraifeatgrat yas afanaial at sfaatETH aaT tA ATTA: AY WATT:aIvare H yataatfae afaeaea eae at aie sa Brew ag alafaaa at are10(2) & ata agar 81 adler a ate & cat sfage zfeeare car 747|az ofa frat nar fe fraifedt yaqa afanciat a1 sfret e qa % fayqifo do algo (waa) fafate® ofanalBer A Fra HT ce aT AKdam saad) at favaBH ad} fear var afer ava aifan & afwnatat afaaa % fear var adtardf at acta az aT fe faaifcdt eT aasaa ar afaarz lava,1948 % sear feat ate ag oferta F far (1) 60 AIR eo AIX 52. On behalf of the appellant it was contended that the High Court had no legal justification for interfering with the finding of the Appellate Tribunal that there was no proof of the agree-ment between the ·assessee and the I. C. I. "(Export) Ltd. with regard to the quantum of commission to be paid to the assessee for the period between 1st April, 1948 and 31st March, 1.951. On this point reference was made by Mr. Chagla to (a) the Jetter dated 11th March, 1947 from the I.C.I. (Export) Ltd. to M/s. D Gillanders Arbuthnot & Co., (b) the affidavits of Mr. W. A. Bell and Mr. J. W. Donaldson and ( c) the Jetter dated 3rd January, 1958 of M/s. Lovelocke and Lewes, Chartered Accountants, Calcutta. It was argued that these documents established that there was an agreement between the I.C.I. (Export) Ltd. and the assessee, that for the period !st April 1948 to 31st March, 1951 E the assessee was entitled to receive as its commission only the amounts representing the difference between the normal rates of commission and the compensation payable to the former agents during that period. The Appellate Tribunal had considered all these documents and reached the conclusion that there was no agreement between the I.C.I. (Export) Ltd. and the assessee and F 'if there was one it was not acted upon'. The Appellate Tribunal remarked that the letter dated 11th March, 1947 from the I.CJ. (Export) Ltd. set forth only the terms and conditions subject to which the selling agencies of the out-going agents were terminat-ed. It was silent on the crucial question of commission to be paid to the assessee during the three years from the date of its appo;nt-ment as sole selling agent. The affidavits of Mr. Bell and Mr. G Donaldson were produced for the first time before the Appeltate Assistant Commissioner. The affidavits were made. tnany years after the cru<;iaJ date of the appointment of the asse<•ee as the . sole selling agent of the I.C.I. (Export) Ltd. The affidavits did not mention the amount of commission to be paid to the out-2oing agents and the affidavits were also not consistent with the entries H in the books of accounts of the assessee. The letter of M/s Love-locke and Lewes was produced at a very late stage during the hearing· of the appeal before the Tribunal and even otherwise the c. '· T. v. IMPERIAL CHEMICAL LTD. (Ramaswami, I.) 8 09 faatiedt 41 more, 1948 FB aeara gaa atant % fae aga watt Sra ATT@ fear att ga ata & aga alas aaa fear a fe sad dat ag Fo onfaafear.aa feafa seadt e aaral a aafad at aal 2, fare ag efera 2 fafretted Aga att at aaa gia fear ate sae a oH arefera arar gzfat frat @ a sfaaz qaqa ufapaiat at fav qci gs ada afar& 2a facny at ax cea at fata at ah z fe featfeat wie argo Alo ATgo(qaani) fafaes & da ale wut fag vet fearmar ys. Fuefavafaaraat at mat & aga % aaa A fratfeal at ea sete Bl eee FATara aaé fe qaqa afanatal st ofaac se wae daa wan afafaaa atarer 10(2)(xv) & welt aga: Ae TaeaaT: HTeaTe F gatas F for afseaeseqq’’ ay| Feat Bl at F oer Hag cela st we fe vH wend eaFR graxqt ara faaifedt ae agaa a ya a ersafza atSf as aie gafae qaqaafuaaiat at dea ofan at wae faatfedt at ara are addy & atat yeal Hacita aaas A fe yaqs afaaaiat a1 ada ofrax 28m