9911796707
TMI Blog1979 (7) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... -firm acted as bankers of M/s. J. K. Cotton Manufacturing Ltd., Kanpur, for a number of years, and was in receipt of commission at the rate of 1% as collection charges. This amount used to be credited by monthly credit notes, and the company's account debited by the corresponding amount. The assessee followed the Samvat year as its accounting year. For the assessment year 1958-59, the previous year ended on 20th March, 1958, and for the assessment year 1959-60, on the 8th April, 1959. So far as the company was concerned, its previous year ended on the 30th September, 1957, and 30th September, 1958, for these two assessment years, respectively. On the 30th September, 1957, a resolution was passed by the company authorising Sri Hemantpat Sing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter in appeal. The assessee's claim for reduction of the commission by an amount of Rs. 44,654.16 for the year 1958-59 was not accepted by the AAC. The claim of Rs. 50,136.80 was, however, allowed for the assessment year 1959-60, on the basis of the agreement aforesaid. In the appeal for the year 1959-60, the assessee had been permitted to raise an additional ground by the AAC to the effect that the amount of Rs. 44,654.16 should be allowed as business expenditure under s. 10(2)(xv). This contention too was not accepted. The assessee appealed. The Tribunal held that so far as the deduction of Rs. 44,654.16 is concerned, that could not be allowed in the assessment year 1958-59, as it had already accrued to the assessee in that year, and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assee-firm credited the amount of Rs. 44,654.16 to the company in keeping with the terms of the agreement, the adjustment made was clearly dictated by reasons of commercial expediency, as the assessee was bound under the terms of the agreement to make the adjustment, as it had agreed to charge lesser rate of interest for the earlier year. It is not correct to say that the Tribunal has not applied its mind to this aspect of the matter, for they have noticed the inconsistencies in the AAC's order while allowing an amount of Rs. 50,136,80 on the basis of this very agreement, and disallowing the amount in dispute now. In fact, a finding has been recorded that the agreement was entered into in the best interest of the business. The second conten ..... X X X X Extracts X X X X X X X X Extracts X X X X
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