1986 (12) TMI 99

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....admitted that it did include financial arrangement but there was an agreement with the various parties by which they were provided commission for providing the assessee the various services such as provision of godown, safety of the goods and also finances. This was a composite contract and cannot be said to be in the nature of interest payment alone. Further the Department is not disputing the fact that the other parties have shown the income in their hands and they have also been taxed. The plea of the assessee before us was that if the non deduction of tax at source on these payments had not resulted in the lose of revenue to the Govt. then there was no necessity of levying the interest under s. 201 on the assessee. For this proposition ....

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....one some service, deduction cannot be allowed. On this issue since it is accepted that the payments have been made and it is also accepted that the payees have been identified and the contract of services also available and these persons have not been examined by the Department to establish that they have not done any service goes only to indicate that the explanation provided by the assessee has been merely rejected. We therefore allow this claim of the assessee. 3. The next of the issue is regarding disallowance out of car expenses which has not been pressed before us. 4. The next ground is regarding claim under s. 35B which has been set aside by the CIT(A) to follow the decision of the Special Bench of the Tribunal in the case of J....