TMI Blog1961 (12) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... . The contract form is annexure A-1 to the affidavit filed in support of the petition. The buyers name as entered in the contract form is: The Lababedi Textiles Manchester, England, through the Pioneer Consolidated Company (London) Ltd. London. The rate at which cloth was to be supplied is mentioned in this contract form as follows: 19? pence less 2? per cent. commission payable to the Pioneer Consolidated Company (London) Ltd. It appears that in respect of the supply of cloth the commission payable to Messrs. Pioneer Consolidated Company amounted to a sum of ₹ 10,777. In the accounts relevant to the assessment year 1952-53 the entries in regard to this transaction which appeared therein were to the effect that the entire amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his conclusion could not be legitimately drawn from the manner in which entries were made in the account books of the petitioner. The debit of the sum of ₹ 10,777 as expenses of sale would seem to show that the liability was of the petitioner for payment of the commission to Pioneer Consolidated Company in respect of the sale of cloth by it to Messrs. Lababedi Textiles of Manchester. Two points have been raised before me by learned counsel for the petitioner to challenge the conclusions of the Income-tax Officer in the impugned order. The first point is that the description of the buyer in the contract form as Lababedi Textiles through the Pioneer Consolidated Company showed that the Pioneer Consolidated Company were the buying age ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ission was of the petitioner, it would not have been necessary to mention in the rate specified in the contract form the rate at 19? pence per yard less 2? percent. commission. It would have been sufficient to mention the rate minus the commission after working out the same without specifying the commission itself as that would be a matter between the petitioner and the Pioneer Consolidated Company, with which Messrs. Lababedi Textiles would have nothing to do. This again to my mind is not conclusive. The mention of the commission in the contract form cannot necessarily lead to the inference that the liability for the payment of commission the situation is equivocal. Taking the description and the rate as mentioned in the contact form and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income-tax Officer has found that the payment of ₹ 10,777 was made not by the petitioner directly but by the petitioner through Lababedi Textiles to Pioneer Consolidated Company. From the accounts and other evidence of the petitioner and upon the findings of the Income-tax Officer the manner in which this was done was that the petitioner received the price of the cloth supplied by it from Lababedi Textiles less the amount of the commission payable by the petitioner to Pioneer Consolidated Company. It follows that Lababedi Textiles constituted themselves an agent of Pioneer Consolidated Company for collecting its commission from the petitioner. The petitioner collected from Lababedi Company the purchase price minus the amount of the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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