Law:

Section:

Section 256, read with section 37(1), of the Income-tax Act, 1961 - Reference - Question of fact - Whether where on appreciation of evidence and facts of case Tribunal held that commission paid by assessee-firm to another firm was expenditure laid out wholly and exclusively for purpose of assessee's business, any referrable question of law arose from Tribunal's order - Held, no Facts The assessee-firm carried on business of purchase and sale of milk canes made of aluminium alloy. During the relevant previous year, the assessee paid certain commission to another firm 'S' in pursuance of an agreement under which 'S' were to help the assessee in procuring orders from various Government and semi-Government departments providing designs for the canes, in getting the goods finished and packed and in securing the payments for the goods supplied. The ITO disallowed the assessee's claim for deduction of the aforesaid commission paid to 'S' On appeal, the Tribunal, on an appreciation of evidence and facts of the case, observed that a valid contract had been arrived at between the assessee and 'S' and that the impugned sum was genuinely paid to that concern and was not an effort to divert the income of the assessee to reduce the tax liability. The Tribunal, accordingly, allowed the assessee's claim. The Tribunal also rejected the revenue's reference application under section 256(1). On application under section 256(2) : Held In the instant case, it was clear that no question of law arose from the order of the Tribunal; pure questions of fact were involved, which, on appreciation of evidence, had been answered by the Tribunal in favour of the assessee. Accordingly, the application for reference was rejected. Ashok Bhan and Ajay Mittal for the Applicant. D.K. Gupta and Hemant Kumar Gupta for the Respondent. Judgment Mital, J.- Ishwar Prakash and Bros, (the assesses) carried on business of purchase and sale of milk cans made of aluminium alloy. Rs. 36,000 were paid as commission to Shiv Shankar Metal Works, Jagadhri, in pursuance of an agreement dated 17-7-1970 during the previous year, which ended on 31-3-1971. Shiv Shankar Metal Works were to help the assessee in procuring…

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