TMI Blog1978 (12) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Mangilal Sethia, the sole selling agent appointed by the assessee under an agreement dated the 2nd February, 1959. The agreement was entered into by and between the assessee and the said sole selling agent in respect of spun R.C.C. pipes and collars manufactured by the assessee and provided, inter alia, as follows: (a) The agency would be effective on and from the 1st February, 1959. (b) The sole selling agent would deposit a sum of Rs. 10,000 to be held by the assessee without interest during the subsistence of the agreement. (c) The sole selling agent would not during his appointment purchase or receive for sale any commodity similar to those manufactured by the assessee from any third party in his own name or account or in the n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment departments or that sales could be effected only with the help of the agents. The assessee did not produce any evidence to establish that the Government departments accepted the contracts only at the initiative or with the help of the selling agents. On further appeal by the assessee to the Tribunal it was contended that the Tribunal should reconsider the decision in the earlier years by reason of two decisions, Chainrup Sampatram v. CIT [1953] 24 ITR 481 (SC) and Ram Luxman Sugar Mills v. CIT [1967] 63 ITR 51 (All). It was also contended that in the relevant assessment year there were some distinguishing features which were absent in the earlier years, namely, that in the earlier years the assessee had three agents, while in this as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me sole selling agent, inter alia, as follows : "...... so far as Mangilal Sethia is concerned the assessee could not establish that he rendered any service to the assessee as a sole selling agent. It is not in evidence that Mangilal deposited the stipulated sum of Rs. 10,000 to the assessee in terms of the agreement or that he secured any order for the assessee for sale of the stipulated products. It was not established that he incurred any expenses on behalf of the assessee on account of establishment or publicity or godown rent or similar items in connection with his agency. Before the ITO, Mangilal stated that the business had been looked after by his brother, Bhikamchand, and that he himself could not state anything as to the service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e mechanically followed their decision in the earlier years. In such earlier years there was no doubt that Mangilal Sethia himself was summoned to depose under s. 131 of the I.T. Act, 1961, and his statements before the authorities were not satisfactory; but it could not be said that such statements governed the position for this year and, therefore, it was for the authorities to enquire further into the matter and ascertain whether any service was rendered by this sole selling agent in this particular year. All the authorities including the Tribunal erred in following their earlier decisions. Mr. Ray contended further that, under the agreement, the sole selling agent had undertaken not to purchase or receive for sale any goods, wares or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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