- (1.) This appeal is preferred by the assessee against an order of the Bombay High court refusing to direct the tribunal to state the following questions of law under Section 256 (2 of the Income Tax Act: "(1 Whether on the facts and in the circumstances of the case, the assessee company's claim under Section 37 for deduction of rs 16,831 paid to the director for payment of commission to dyeing masters, purchase officers and other working in different textile mills to whom the assessee company supplied dyes and chemicals could be disallowed in determining the profits for Assessment Year 1973-74 (2 Whether the tribunal was right in allowing Revenue authorities to raise for the first time the plea that the secret commission expenditure was not incurred for the purpose of assessee company's business (3 Whether on the facts and in the circumstances of the case was the tribunal justified in holding that there was no evidence that there was any practice of payment of secret commission to dyeing masters. 196 purchaser officers etc. when in fact the tribunal has accepted in general the position that such practice is prevalent in the colours and chemicals business. "
(2.) The assessee is a private company engaged in manufacture of chemicals and dyes. In the assessment relating to assessment year 1973- 74, it claimed deduction in respect of a sum of Rs. 16,831. 00, stated to have been paid by way of secret commission to Dyeing Masters, Purchase officers and other workers in textile mills to whom the assessee supplied dyes and chemicals. This claim was negatived by the I. T. O. whereupon the assessee preferred an appeal before the Appellate Assistant commissioner. The Appellate Assistant Commissioner allowed the appeal and remitted the matter to the I. T. O. for further enquiry giving an opportunity to the parties to adduce evidence in that behalf. After considering evidence adduced by the assessee, I. T. O. again rejected the claim for deduction. The matter was carried in appeal to Appellate assistant Commissioner and the tribunal, but without success. An application under Section 256 (1 was also rejected by the tribunal. The assessee approached the High court under Section 256 (2 and on refusal by High court, he has filed this appeal.
(3.) A perusal of the tribunal's judgment shows that it has found as a fact that the assessee has failed to establish that the said amount was expended by it for the purpose indicated by it. This finding is based upon more than one circumstance. The tribunal has observed that not only has the assessee failed to disclose the names of the recipients, even the commission allegedly paid is not uniform. In some cases, it is at the rate of 2%. It also pointed out that the mere fact that certain amount was made available to the Director is not sufficient in the circumstances to prove its payment inasmuch as according to the assessee, the amounts were not paid out by the Director himself but through other employees of the assessee. It observed that even the names of the persons who have allegedly made payments to the Dyeing Masters have also not been disclosed. It is in view of these several circumstances that the tribunal recorded the finding that the assessee has failed to establish that the said expenditure was in fact incurred. In view of this finding, the questions of law sought to be raised by the assessee do not arise. Question no. 1 is based upon the assumption that such payments are proved when it was not so. We may also point out that none of the three questions suggested by the assessee seek to question on the finding of fact recorded by the tribunal.;