1983 (1) TMI 43

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....J.-By this reference u/s. 256(1) of the I.T. Act, 1961 (hereinafter referred to as " the Act "), the Income-tax Appellate Tribunal, Indore, Bench, Indore, has referred the following question of law to this court for its opinion : " Whether, under the facts and circumstances of the case, the Tribunal was justified in disallowing Rs. 12,000, being commission paid to Shri J.. M. Nadkarni, u/s. 40A....

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.... commission of Rs. 12,000. On appeal, the AAC affirmed the disallowance made by the ITO. On further appeal, the Tribunal held that there was no evidence that, at the material time, there had been any agreement entered into by the assessee-firm with Shri J.M. Nadkarni to pay any commission to him in addition to his salary of Rs. 24,000 per annum and that a copy of the agreement produced by the asse....

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....tners of the assessee-firm, the provisions of sub s. (2) of s. 40A of the Act are attracted. The Tribunal, after taking into consideration the fact that there was no agreement at the relevant time to pay commission to Shri J. M. Nadkarni, has upheld the order of the ITO holding that the sum of Rs. 12,000 paid to Shri Nadkarni, by way of commission, was excessive and was not allowable. The finding ....