TMI Blog1999 (3) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... in law in allowing deduction by way of commission claimed at Rs. 1,14,415, when the recipient had admittedly not rendered any services to the assessee for procuring the business in question and when there was no direct evidence available to prove that services had in fact been rendered by any person in this behalf ?" The assessee, a partnership firm at Faridabad, filed a return for the assessment year 1988-89 showing income of Rs. 1,28,370. The Assessing Officer, during the assessment proceedings, disallowed deduction amounting to Rs. 1,14,415 on account of commission paid on certain sales. That money was claimed by the assessee as having been paid to Smt. Asha Y. Kanakia of Bombay for services rendered by her in procuring business for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agency agreement was reached between the assessee-firm and those three persons on January 20, 1987, for the sale of power presses of the assessee-firm through them on commission basis. This agreement was jointly executed by the three members of the Kanakia family and was signed by them. Naresh Sharma further explained that the name of Asha Y. Kanakia was substituted in place of her husband, Yogesh K. Kanakia, at the latter's instance. It was agreed that the three persons, namely, Ramesh, Kirti and Yogesh would procure orders for the assessee-firm and would also follow up the payments of sale proceeds to it. The orders for supply of power presses to Packers India (P.) Ltd., Bombay, Izuki Auto India, Faridabad, and Madras Fabricators, Bombay, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the company. Orders were received by the assessee-firm from Packers India (P.) Ltd., Bombay, because the recipients had close connection with the affairs of the company. Commission was paid on account of commercial expediency. It has also come on the record that Asha Y. Kanakia went with her husband, Yogesh K. Kanakia, to secure orders for the supply of goods to Izuki Auto India, as was admitted by Shri F. C. Singhal, the managing partner of the aforesaid buyer, before the Assessing Officer. The manager of the assessee-firm also confirmed in his statement before the Assessing Officer that the orders for the supply of goods were received on account of the services rendered by the members of the Kanakia family. Yogesh K. Kanakia, husband o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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