TMI Blog2002 (5) TMI 225X X X X Extracts X X X X X X X X Extracts X X X X ..... ent between the assessee and the sole-selling agent M/s Texind Corporation (P) Ltd. provided for payment of commission to third parties. 4. The assessee has not stated the exact nature of services rendered by the third parties and has also not clearly proved that the payments are genuine." Briefly stated the facts of the case are that the assessee, the proprietor of M/s Allied Engineering Industries, is a manufacturer of travelling cleaners, which is an accessory for spinning textile machineries. For the asst. yr. 1991-92 the total turnover was around Rs. 2 crores. For around 20 years the assessee had a sole selling agency agreement with M/s Texind Corporation (P) Ltd. and this agent has its registered office at Bombay and have branch o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent order. On the other hand, the learned counsel for the assessee placed on record a compilation consisting of 53 sheets comprising therein the contents as mentioned in the index to such paper book. The paper book contains written submissions also. He reiterated that contents of the written submissions as his arguments which are extracted below. The order of the learned AO disallowing the commission payment is payment is against the facts and circumstances of the case and in any case violative of the principles of equity and natural justice and contrary to the provisions of law. Unlike cases involving payment of secret commission, the respondent had willingly co-operated with the learned AO and provided the names and addresses of the perso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... officer has erred in disallowing the amounts despite the fact that the payments were all made only through crossed account payee cheques. The learned officer has erred in rejecting the submissions of the respondent on the ground that the nature of services rendered by the parties was never established. The respondent has always submitted that the parties due to their influential position could determine whether the orders would reach the respondent from the customer companies or not and the commission payments to them were imperative to persuade them to exercise this influence and get orders for the respondent. The parties themselves have issued signed confirmations where they have clearly stated that but for their role, the orders would n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... light of the facts and the materials coupled with the case laws relied upon by the learned counsel for the assessee. We feel that there is much force in the contention of the learned counsel for the assessee in supporting the impugned order. While passing the appellate order the learned CIT(A) has observed as under: "I have given careful consideration to the contentions of the learned authorised representative. I have also perused the assessment order passed by the AO. Fact remains that the appellant has paid secret commission to certain persons connected with the textile industry in order to procure business in the face of heavy competition. The payments have also been made as informed by the sole selling agent M/s Texind Corporation. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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