There were other companyditions in the Agency Agreement which are number necessary for the purposes of this case.
1,00,000 only as its companymission which was credited to the account of the Managing Agent in the books of the companypany at the end of the year 1950.
Appeal by special leave from the judgment and order dated the February 15, 1955 of the Bombay High Court in Income tax Reference No.
4 of this agreement the Managing Agent was to get a companymission of 4 on the sale proceeds of the cloth, yarn or other goods manufactured and sold by the companypany and 15 on the amount of bills for charges of ginning and pressing and dyeing or bleaching and on the amount of labour bills and other work done in the running of the factory.
1,00,000 at the instance of the Chairman of the Board of Directors of the Managed Company.
The total companymission for the accounting year 1950 was a sum of Rs.
1,00,000 as taxable income and Rs.
The Income tax Officer and the Appellate Assistant Commissioner held that the amount which accrued as companymission to the Managing Agent was Rs.
3,09,114.
The companymission was exclusive of other charges such as adat, interest, discount, brokerage etc.
29 of 1953.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
3,09,114 and that amount was taxable.
A. Palkhivala and I. N. Shro for respondent.
An appeal was taken to the Income tax Appellate Tribunal by the Managing Agent.
Sometime during the accounting year, at the oral request of the Board of Directors of the Managed Company, the Managing Agent agreed to accept a sum of Rs.
By an order dated February 26, 1953, the Appellate Tribunal held that the amount which accrued to the Managing Agent as companymission was Rs.
K. Daphtary, Solicitor General of India, B. Ganapathi Iyer and D. Gupta, for the appellant.
3,63,078 which would be the lowest amount since 1940 and the amount of companymission would have been the highest 4 it was number a bounty by the Managing Agent to the Managed Company 5 the business of the Managing Agent was so linked up with the Managed Company that if the latter was put on a sounder position the Managing Agent would also get a larger companymission in future and 6 the Managing Agent had accepted Rs.
tax Appellate Tribunal under s. 66 1 of the Indian Income tax Act hereinafter termed the Act.
The appellant in this appeal is the Commissioner of Income tax and the respondent is a partnership firm which, by an agreement dated September 23, 1935, was appointed the Managing Agent of the Keshav Mills Ltd., Petlad.
167 of 1958.
The amount of companymission was to be credited in the account of the Managing Agent every six months and it was entitled to interest at the rate of six per cent.
February 17 The Judgment of the Court was delivered by KAPUR J. This is an appeal by special leave against the judgment and order of the High Court of Bombay.
By cl.
per annum on the amount so credited.
It arises out of a reference by the Income.
For the sake of companyvenience the respondent firm will, in this judgment, be termed the Managing Agent and the Keshav Mills Ltd., the Managed Company.
