COMMISSIONER OF INCOME TAX Vs. DADHA CO

JUDGEMENT

(1.) INSTEAD of the four questions sought to be referred by the Revenue, the Tribunal referred the following question :

(2.) DURING the period relevant to the assessment year 1975 -76, the assessee entered into an agreement dated October 15, 1973 (annexure E), with certain persons. In terms of that agreement, the business carried on by the assessee was transferred to the second party to the agreement on certain conditions. Two of the conditions alone are relevant for the purpose of this case. They are contained in Clauses 6 and 7 which read as under :

(3.) BY order dated October 18, 1975 (annexure A), the Income -tax Officer brought to tax a sum of Rs. 39,142 which, according to the officer, was the amount received by the assessee during the relevant accounting year as commission on the basis of 0.25 per cent. of the turnover of the transferee -company. The Income -tax Officer thus found that income had been received by the assessee as commission on the basis of 0.25 per cent. of the turnover of the transferee's business.