RAM SURAT RAM (MAURYA), J. - (1.) HEARD Sri Rakesh Kumar, the counsel for the appellant and Sri Shambhu Chopra, Senior Standing Counsel for the Revenue.
(2.) THIS appeal has been filed, under Section 260 -A of the Income Tax Act, 1961 (hereinafter referred to as the Act) from the order of the Income Tax Appellate Tribunal, Lucknow dated 29.10.2004, passed in Income Tax Appeal No. 2441/Allahabad/1995 by which the appeal filed by the Revenue has been allowed and the matter has been remanded to the Assessing Officer to decide the case afresh. The appellant proposed the following substantial questions of law: "1. Whether on the facts and in the circumstances of the case, the learned Income Tax Appellate Tribunal was justified in setting aside the order of the Commissioner of Income tax (Appeals)? 2. Whether in the facts and circumstances of the case, the learned Income Tax Appellate Tribunal is justified in setting aside the order of the Commissioner of Income tax (Appeals) without reverting and considering the reasons given by the aforesaid authority? 3. Whether the learned Income Tax Appellate Tribunal is justified in remanding the case to the Assessing Officer specifically when the all basic material for deciding the controversy was on record? 4. Whether in the facts and circumstances of the case, there was any justification with learned Income Tax Appellate Tribunal for not following the earlier order of the Income Tax Appellate Tribunal which was affirmed by this Hon'ble Court by dismissing the reference application made under Section 256 (2) of the Income Tax Act?" The facts giving rise to the present appeal are as follows: The appeal relates to the assessment year 1993 -94. M/S General Trading Company (the assessee) is carrying on business of distribution of cement, manufactured by Birla Jute & Industries Ltd. (the company) under the appointment letter dated 12.08.1991 of the company. Under this appointment letter, the assessee is authorized to appoint sub -distributors at its own level for which the company is not liable to make any payment. The commission of the assessee was Rs. 5/ - per tonne. The assessee appointed three sub -distributors namely (i) M/S Khajuraho Traders Lucknow, (ii) Ruhelkhand Agency, Bareilly and (iii) Adarsh Enterprises Agra, on the commission of Rs. 3/ - per tonne. The assessee submitted it's Income Tax Return on 01.11.1993, in which he claimed deduction of Rs. 13,45,025.70/ - as the amount of commission paid to aforementioned three sub -distributors. Before the Assessing Officer, the assessee produced correspondence folder of the above three dealers regarding supply of stocks relating to the sale of cement during the assessment year and payment of commission which were also corroborated from the bank accounts and assessment orders of the sub -distributors. However, the Assessing Officer through its letter required the assessee to explain the commercial expediency of the business, need of making payment of the commission to sub -distributors and work done/services rendered by the sub -distributors.
(3.) THE Assessing Officer by its order dated 31.01.1995 held that the assessee had failed to prove the work done/services rendered by the sub -distributors as such he disallowed the deduction of the amount of the commission paid to the sub - distributors on the ground that no evidence had been furnished regarding work done/services rendered by the above three dealers. The assessee preferred an appeal from the aforesaid order before the Commissioner of Income Tax (Appeals), Kanpur. The Commissioner of Income Tax (Appeals) placed reliance on the order of his predecessor for the assessment years 1988 -89 and 1989 -90 wherein the payment of commission were disallowed by the Assessing Officer, had been allowed by the Tribunal, accordingly he vide order dated 06.10.1995 allowed the appeal and deleted the addition. The Revenue feeling aggrieved filed an appeal before the Tribunal. The Tribunal by the impugned order held that the order of the Assessing Officer and the Commissioner of Income Tax (Appeals) are cryptic and there were no discussion of the evidence collected by the Assessing Officer as such he set aside both the orders and remanded the matter to Assessing Officer for fresh decision on merits.;