TMI Blog2003 (1) TMI 243X X X X Extracts X X X X X X X X Extracts X X X X ..... centives or bonus on achieving the targeted sales. The AO has further held that as the commission credited by the assessee, to the dealers, amounted to Rs. 92,81,460, the assessee is liable to pay the amount of tax non-deducted which, worked out at the rate of 10 per cent of the amount of commission, comes to Rs. 9,28,146. The AO further held that the assessee is liable to pay interest under s. 201(1A) on the aforesaid amount which worked out to further Rs. 9,74,505 till 31st March, 1999. Aggrieved, assessee carried the matter in appeal to the CIT(A) but without any success. Still aggrieved, the assessee is in appeal before us. 3. Learned counsel for the assessee has submitted that the assessee-company is a manufacturer of ayurvedic medi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re on principal-to-principal-basis, the sales made to the dealers/distributors is on their account and that, irrespective of the terminology employed, the relationship between the assessee vis-a-vis the dealers/distributors is of the seller and buyer. It is also submitted that the goods are sold to dealers vide sales bills and the property in goods passes to the dealers on the invoices being raised and the goods being shipped to the dealers. A reference was then made to the CBDT Circular No. 619, dt. 4th Dec., 1991, and Hon'ble Bombay High Court's judgment in the case of Harihar Cotton Pressing Factory vs. CIT (1960) 39 ITR 594 (Bom) in support of the submission that the payment in question is not covered by the connotation of expression 'c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ression 'commission or brokerage', for the purpose of s. 194H, has been defined as follows: '"commission or brokerage" includes any payment received or receivable, directly or indirectly, by a person acting on behalf of another person for services rendered (not being professional services) or for any services in the course of buying or selling of goods or in relation to any transaction relating to any asset, valuable article or thing not being securities."' We find that the expression 'commission' and 'brokerage' have been used together in the statute. It is well settled, as noted by Maxwell in Interpretation of Statutes and while elaborating on the principle of noscitur a sociis, that when two or more words which are susceptible to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... down by Lord Bacon, that copulatio verborum indicat acceptationem in eodem sensu the coupling of words together shows that they are to be understood in the same sense." 6. Let us now deal with legal connotations of these two expressions, namely 'commission' and 'brokerage'. The Law Lexicon (Edited by Justice Y.V. Chandrachud; 1997 Edn.) observes that 'in commercial law, commission is a compensation to a factor or other agent for services to be rendered in making a sales or otherwise; a sum allowed as compensation to a servant, factor or agent who manages the affairs of others, in recompense for his services'. According to the given definition, "It is an allowance, recompense or reward made to agents, factors and brokers and others for ef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liged to, a view indeed seems possible that the scope of expression 'commission', for this purpose, will be confined to 'an allowance, recompense or reward made to agents, factors and brokers and others for effecting sales and carrying out business transactions' and shall not extend to 'trade discounts' which at best the assessee's commission claim in the present case. As we are adjudicating, on legality of a TDS liability imposed in the course of rectification proceedings under s. 154, suffice it to say that a matter, on which clearly a view in favour of assessee is possible, a demand cannot be raised in the course of such proceedings. It is well settled in law, as held by Hon'ble Supreme Court in the case of T.S. Balaram, ITO vs. Volkart ..... X X X X Extracts X X X X X X X X Extracts X X X X
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