LexTHE COTTON AGENTS LTD., BOMBAY versus COMMISSIONER OF INCOME-TAX, BOMBAY
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Chandaji Kubaji & Co. v. State of A ndhra P-radesh S. K. Das]. x960 May3. 810 SUPREME COURT REPORTS [1960] on deliberate negligence and fraud and amounts to allowing a party to profit from its own wrong. We do not think that such a construction follows from the language used, which is more consistent with the view that the provision ins. 12A(6)(a) permits a review when through some oversight, mistake or error the necessary facts, basic or evidentiary, were not present before the Court when it passed the order sought to be reviewed. It is entirely wrong to think that the sub- section permits a party to play hide and seek with a judicial Tribunal; that is to say to raise a fact in issue or evidentiary fact as a plea in support of a claim and at the same time deliberately withhold the evidence in support thereof. Such a situation cannot be said to be one within the meaning of the expression "facts not present before the Tribunal ". In the appeals before us there was intentional with- holding or suppression of evidence. In the case, the materials were not produced on the plea that they were written in Gujrati and nobody was avail:;tble to instruct counsel in English or Telugu and in the other, on an equally specious plea that the correspondence was mixed up with other records for about two years. These two appeals can be disposed of on this short ground that the appellant was not entitled to ask for review under s. 12A(6)(a) by reason of his own delibe- rate negligence and intentional withholding of evid- ence. We see no merit in these appeals and dismiss them with costs. Appeals dismissed. THE COTTON AGENTS LTD., BOMBAY v. COMMISSIONER OF INCOME-TAX, BOMBAY. . (S. K. DAS and M. HrnAYATULLAH, JJ.) Income-tax-Managing Agency Agreement-Proper construction of-Commission on sale proceeds of the managed company-Time of accruing. Messrs. Shivnarayan Surajmal Nomani were the managing agents of the New Swadeshi Mills of Ahmedabad Ltd. The Nemani group and the appellant-company which is the assessee - - ,J .. ,..,. ... 3 · S.C.R. SUPREME COURT REPORTS 811 held a substantial number of shares of the said mills. Sometime z96o 'in 1944 some difference arose between them and it was decided -- that the Nemani group should sell its block of shares to the Cotton A gents l.td. appellant company at an agreed price and then the appellant v. company would become the managing agents of the mills com- Commissioner 0! Income-tax pany on payment of Rs. 5,00,000 to the Nemani group and would be entitled to the emoluments of the managing agents as from April l, 1944· , The relevant portion of the Managing Agency Agreement ran thus :- " (2) The remuneration of the agents as such agents of the company as aforesaid shall be as follows :- A commission at the rate of three and a half per cent. on the gross proceeds of all sales of the yarn, cloth, waste and other articles manufactured by the company earned in any year or other period for which the accounts of the company are made up and laid before the General Meeting." " (3) The said commission shall become due to the Managing Agents at the end of each financial year or other period for which the accounts of the company are to be laid before the General , Meeting and shall be payable and paid immediately after such accounts have been passed by the General Meeting." The assessment year was 1946-47, and the year ending with Diwali, 1945 (October 18, 1944, to November 4, 1945) was the accounting year. The managing agency commission from Aprill, 1944, to December 31, 1944, amounted to Rs. 2,20>433 and from January l, 1945, to March 31, 1945, to Rs. 67,959. The case of the appellant-company was that for the assessment year 1946-47 it was liable to pay tax only on the commission of Rs. 67,959 which it had earned by working as managing agent of the Mills company and it was not liable to pay tax on the sum of Rs. 2,20>433· On a difference of opinion having arisen between the departmental taxing authorities and the Tribunal the follow- ing question was referred to the High Court for decision :- " Whether on the facts and circumstances of the case the managing agency commission of 3!% on sales made by the New Swadeshi Mills of Ahmedabad Ltd., between April l, 1944, and December 31, 1944, accrued to Shivnarayan Surajmal Nemani or to the assessee ? " . The High Court following the decision of the Supreme Court in E. D. Sas
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