9911796707
TMI Blog2006 (7) TMI 98X X X X Extracts X X X X X X X X Extracts X X X X ..... ersing the order of the Commissioner of Income-tax (Appeals) ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal is correct in law and fact in holding that the 'contingency deposit' being money received from the principals and retained by the agent for the discharge of the liability of the principals from the payments due to the principals is a trading receipt in the hands of the appellant? 3. Whether the Tribunal is correct in law and fact in holding that as 'dealer' under the Sales Tax Act includes a commission agent also, the burden to pay turnover tax which is on the principals shifts to the appellant? 4. Whether the Tribunal has erred in not properly considering the relationship between the agent and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not applicable with regard to contingency deposit. Accepting the said contention the Commissioner (Appeals) deleted the addition made by the Assessing Officer. 3 The Revenue took up the matter in appeal before the Tribunal. The Tribunal noticed that as per the Sales Tax Act and also the Turnover Tax Act, the term "dealer" includes a commission agent. The assessee's claim that the assessee being a commission agent cannot be treated on par with a real business person, i.e., a dealer, was not accepted. The Tribunal also placed reliance on the decision of the apex court in CIT v. Thirumalaiswamy Naidu and Sons [1998] 230 ITR 534 and took the view that the amount collected by the assessee be treated as income of the assessee. The app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot change the character of the receipt. In support of his contention counsel placed reliance on the decision of the apex court in Raghuvanshi Mills Ltd. v. CIT [1952] 22 ITR 484. Counsel also placed reliance on the decision in CIT v. India Carbon Ltd. [2003] 262 ITR 327; [2003] 132 STC 295 (Gauhati), CIT v. Dharamdas Hargovandas [1961] 42 ITR 427 (SC) and CIT v. G. R. Karthikeyan [1993] 201 ITR 866 (SC) etc. 6 We are of the view that the mere fact that the liability to pay turnover tax and also the increase in the rate of rubber from 5 per cent. to 6 per cent. was disputed would not change the character of the amount received. The amount deposited by the assessee in the account by name "Contingency deposit" was noth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... K. C. P. Ltd. v. CIT [2000] 245 ITR 421. The principles laid down in Kesaria Tea Co.'s case [2002] 254 ITR 434 (SC) would not apply to the facts of this case. In Kesaria Tea Co.'s case [2002] 254 ITR 434, the apex court held that the unilateral action of the assessee writing back the amount of liability in the books of account is not a conclusive evidence to hold that the liability has come to an end for all. 8 The question is not whether the liability of the assessee towards payment of tax came to an end or not. In Jonnalla Narashimharao and Co. v. CIT [1993] 200 ITR 588 (SC) the assessee was a commission agent, collected in the assessment year 1968-69 certain amounts by way of sales tax under the name "rusum". The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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