Judgement R. S. PATHAK, J. : - This is a reference under S. 60(1) of the Indian Income-tax Act. The assessee which is a partnership firm, was appointed by the British India Corporation as the sole selling agent of one of its managed concerns, the Cawnpore Cotton Mills, under an agreement D/- January 22, 1946. The agreement, which was originally intended to endure for one year, was subsequently extended from time to time. It appears that the assessee was informed that his continuation as sole selling agent was not considered feasible as it was no longer in a position to run the selling agency in accordance with the wishes of the British India Corporation. The assessee also owed the Corporation a sum of Rs, 8,39350-15-6, which, it seems, it was unable to pay. On March 23, 1955, the assesses entered into a written agreement with me Kailash Nath Agarwal, the preamble to which recited the circumstances in which the assessee was unable to continue as sole selling agent and also the circumstance that the British India Corporation intended to appoint the said Kailash Nath Agarwal or a firm or limited company managed and controlled by him as sole selling agent provided the assessee and Kailash Nath Agarwal were successful in coming to an agreement which, while enabling the assessee to retire from the agency, safeguarded the payment of the debts owed by it to the Corporation. The relevant terms of the agreement between the assessee and Kailash Nath Agarwal are reproduced hereunder : "(1) That Messrs. Sharma and Co., will resign (or will accept the termination of their) sole selling Agency of the Cawnpore Cotton Mills Branch of the Corporation. (2) That Messrs. Sharma and Co. will have no objection to the appointment of Shri Kailash Nath Agrawal or a firm or company formed by him as sole selling agents of Cawnpore Cotton Mills Branch of the Corporation and will have no claim whatsoever against the Corporation for the termination of Sharma and Company's agency and the appointment of Kailash Nath Agrawal or his nominee as sole Selling Agents of the Cawnpore Cotton Mills Branch of the Corporation. (3) That in consideration of the above covenants Kailash Nath Agarwal or the firm or Company formed by him to take over the Sole Selling Agency will pay to Messrs. (3) That in consideration of the above covenants Kailash Nath Agarwal or the firm or Company formed by him to take over the Sole Selling Agency will pay to Messrs. Sharma and Co., one-seventh of the commission earned by them on the sales of the Branch or a sum of Rs. 50,000/- per annum whichever is greater till such time as the Corporation dues-against Messrs. Sharma and Co. are liquidated as provided in paras 4 and 5 hereinafter. (4) That the parties agree that the 'Corporation' will be authorised to retain an amount equal to one-seventh of the commission of the sole Selling Agency with minimum of Re. 50,000/- per annum and to adjust the sum so retained towards the dues against Messrs. Sharma and Co., till the liability of the latter firm with interest thereon at 6 per cent per annum. is entirely liquidated. (5) That is the event of the dissolution of Messrs. Sharma and Co., before the complete repayment of the liability of Messrs. Sharma and Co., Kailash Nath. Agrawal agrees that the 'Corporation.' may continue to retain an amount equal to one-seventh of the Selling Agency commission and adjust it towards such dues of Sharma and Co. as may then be outstanding. (7) That Kailash Nath Agrawal will get an, agreement containing the covenants herein agreed, executed by the sole Selling Agency firm formed by him failing which he, his successors, legal representatives, or assigns will be personally liable for the due performance hereof." 2. On the same day, March 23, 1955, the assessee informed the British India Corporation of the agreement and tendered its resignation as sole-selling agent. In respect of the liquidation of the debts owed by it to the Corporation, it stated that it was entitled to receive one-seventh of the commission due to the new selling agency or to a sum of Rs. 50,000/- per annum whichever was greater until the debts with interest thereon were fully liquidated, and it authorised the Corporation to retain that amount tailing due to the assessee out of the commission payable to the agency and to adjust the same to the assessee's account with the Corporation. It emphasised that the resignation was in consideration, of the terms offered by the new selling agents and accepted by it. 3. It emphasised that the resignation was in consideration, of the terms offered by the new selling agents and accepted by it. 3. Another letter was addressed by Kailash Nath Agarwal to the British India Corporation on March 23, 1955, similarly informing the Corporation of his agreement with the assessee and of the-terms included in that agreement, and requested the Corporation to grant the sole selling agency to Messrs. M.K. Brothers a partnership firm consis ting of himself and Moti Chandra. 4. The British India Corporation in its reply to the assessee on March 23, 1955, communicated its acceptance of the assessee's resignation from the sole selling agency of the Cawnpore Cotton Mills and intimated its proposal to appoint Kailash Nath Agrawal or a firm nominated by him to that office. It confirmed the arrangement arrived at between the assessee and Kailash Nath Agarwal in respect of the liquidation of the assessee's debts to the Corporation and assured the assessee that these terms would be incorporated in the new sole selling agency agreement to be executed with Kailash Nath Agrawal. 5. On March 20, 1955, the Board of Directors of the British India Corporation held a meeting, in which the resignation of the assessee and the appointment of Messrs. M.K. Brothers were noted and a minute was recorded in the following terms : "M.K. Brothers had undertaken to pay off gradually the outstanding unsecured debt of 51/2 lacs due by M/s Sharma and Co. to the extent of one-seventh of their selling agency commission or Rs. 50,000/-, per annum whichever is greater until the debt was cleared." 6. It seems that ultimately the Corporation decided upon appointing a private limited company, M.K. Brothers Ltd., which was promoted by Kailash Nath Agarwal and an agreement appointing it as sole selling agent was executed on July 31, 1956. Under that agreement, M.K. Brothers Ltd., ratified and adopted the agreement entered into by Kailash Nath Agarwal with the assessee and authorised the Corporation to give effect to the terms of the agreement so far as it affected it, particularly in regard to the retention of an amount equal to one-seventh of the commission, with a minimum of Rs. 50,000/- per annum, which amount would be adjusted by the Corporation against the dues of the assessee. 50,000/- per annum, which amount would be adjusted by the Corporation against the dues of the assessee. This and similar other provisions were included in the agreement in order to give effect to the several agreements of March 23, 1955, to which we have referred above. 7. During the accounting year or the assessee ending June 21, 1955, a sum of Rs. 12,500/- was paid by M.K. Brothers Ltd., to the British India Corporation on behalf of the assessee towards the liquidation of the assessee's dues. In the assessment proceedings for the relevant assessment year 1956-57 of the Income Tax Officer held that this sum fell for assessment in the hands of the assessee by reason of Sec. 10(5A)(d). The assessee proceeded in appeal to the Appellate Assistant Commissioner, contending, inter alia, that the sum of Rs. 12,500/-could not be included by reference to Sec. 10 (5A)(d). The Appellate Assistant Commissioner, however, not only rejected this contention but took the view that the amount which should be taxed in the hands of the assessee was not the sum of Rs. 12,500/- but the present actuarial value of the instalments of compensation which would be received in the years to come, and after complying with the appropriate procedure for enhancement of the assessee's income, estimated the actuarial value of the instalments at Rs. 4,50,000/- and accordingly enhanced the assessment by Rs. 4,37,500/-. The assessee then preferred an appeal before the Income Tax Appellate Tribunal and the Appellate Tribunal confined the view of the subordinate authorities that a certain sum on account of compensation or other payment taxable under Sec. 10(5A)(d) was liable to be assessed in the hands of the assessee but held that the sum should be merely Rs. 12,500/- as determined by the Income Tax Officer. 8. Upon these facts, the Appellate Tribunal, at the instance of the assessee has made this reference on the following question : "Whether on the facts and in the circumstances of the case, the sum of Rs. 12.500/- in question could be assessed as income of the assessee under S. 10(5A)(d) of the I. T. Act, for assessment year 1956-57"? 8a. Upon these facts, the Appellate Tribunal, at the instance of the assessee has made this reference on the following question : "Whether on the facts and in the circumstances of the case, the sum of Rs. 12.500/- in question could be assessed as income of the assessee under S. 10(5A)(d) of the I. T. Act, for assessment year 1956-57"? 8a. Sec. 10 (5A) was inserted in the Indian Income-Tax Act by the Finance Act, 1955, and it sets out the various instances in which compensation or other payment due to or received by an assessee is liable to be treated as the profits and gains of a business carried on by him and which, accordingly, shall be liable to tax. Sec. 10 (5A) (d) reads as follows : "Any compensation or other payment due to or received by : (a) ............................................... (b) ............ ................................. (c) ............................................. (d) any person, by whatever name called, holding an agency in the taxable territories for any part of the activities relating to the business of any other person, at or in connection with the termination of his agency or modification of the terms and conditions relating thereto; shall be deemed to be profits and gains of a business carried on by the ...... person ....... and shall be liable to tax accordingly;....... " 9. Learned counsel for the assessee contends, in the first place, that under the agreements to which we have referred above the assessee was not entitled to receive any sum from the British India Corporation or from Kailash Nath Agarwal and it cannot also be said that any sum was due to the assessee. We are unable to accept this contention. It is apparent from the terms of the several agreements that the debts owed by the assessee to the British India Corporation were to be liquidated by the retention by the Corporation of a certain part of the commission due to the new Selling Agent. The sum retained, by the Corporation was to Le adjusted towards the liability of the assessee. In other words, the entire transaction or arrangement between the parties amounted to a notional payment of such sum from the new Selling Agent to the assessee, and a notional payment by the assessee to the Corporation for adjustment against the debts owed by it to the Corporation. In other words, the entire transaction or arrangement between the parties amounted to a notional payment of such sum from the new Selling Agent to the assessee, and a notional payment by the assessee to the Corporation for adjustment against the debts owed by it to the Corporation. This was in accordance with, and under, the terms of the several agreements of 23rd March, 1955. Of these agreements, one was between the assessee and Kailash Nath Agarwal and another between the assessee and the Corporation, under the terms of the agreement between the assessee and Kailash Nath Agarwal, it could be said that a notional payment was made by Kailash Nath Agarwal to the assessee. Having regard to the respective contractual obligations of the parties, we would hold that the sum of Rs. 12,500/- was a payment due to or received by the assessee. Learned counsel has relied upon the decision of the Supreme Court in P.H. Divecha v. Commr. of Income-tax, (1963) 48 ITR 758 : ( AIR 1964 SC 758 ), but we are of opinion that the facts of this case are clearly distinguishable. It was there held by the Supreme Court that the case did not fall under any of the four categories mentioned in S. 10(5-A) and therefore the issue whether the payment which was questioned did or did not fall under the description "any compensation or other payment due to or received by" the assessee do not arise for consideration in that case. 10. It was next contended for the assessee that the provisions of S. 10(5-A)(d) could be attracted only if the agency of the assessee had been terminated by the British India Corporation, that in the instant case the agency was surrendered by the assessee upon its own volition and it did not cease because of any act on the part of the British India Corporation. This contention also is without force. It is not necessary that in order to fall within the terms of S. 10(5-A)(d) the agency should be terminated by external authority. It appears plain to us that even where the assessee himself terminates the agency, the case would fall within the scope of S. 10(5-A)(d). 'Termination' means merely "cessation" and there is nothing in the context in which this word is used to indicate that the cessation must result from the decision or act of an external agency. It appears plain to us that even where the assessee himself terminates the agency, the case would fall within the scope of S. 10(5-A)(d). 'Termination' means merely "cessation" and there is nothing in the context in which this word is used to indicate that the cessation must result from the decision or act of an external agency. 11. The third contention raised by the assessee is that the sum of Rs. 12,500/- could not have accrued during the relevant previous year, because under the terms of the agreement the right of the British India Corporation to retain the sum of Rs. 12,500/- from the commission due to the new Selling Agent could not accrue before the end of the year following its appointment as Selling Agent. It is urged that the income-tax authorities were not entitled to treat the sum of Rs. 12,500/- as income accruing during the year ending 21st June 1955, which date was only about three months from the date on which the agreements were entered into, and before which date (i.e. 21st June 1955; nothing had been dons by the new Selling Agent to earn the commission out of which the sum of Rs. 12,500/- was to be retained by the Corporation. This point was not urged before the Appellate Tribunal and was not decided by it, and we cannot, therefore, say that it arises out of the appellate order of the Tribunal. The Income Tax Officer expressly held that the sum of Rs. 12,500/- was a payment due to or received by the assessee during the previous year ending 21st June 1955, and if the assessee questioned this finding it should have raided the point before the Appellate Tribunal. We must, therefore, decline to consider this contention. 12. It was also urged that the payment of Rs. 12,500/- was not liable to be assessed under S. 10(5-A)(d) because it was not a payment which could be said to have been made by the British India Corporation, which was the principal for whom the assessee was sole Selling Agent. In our view, S. 10(5-A)(d) does not require that the payment contemplated therein should proceed from the principal or the employer. It is immaterial whether the payment proceeds from the principal or employer or from some other person. In our view, S. 10(5-A)(d) does not require that the payment contemplated therein should proceed from the principal or the employer. It is immaterial whether the payment proceeds from the principal or employer or from some other person. All that is necessary is that it must be a payment due to or received by a person holding an agency, and the payment is made at or in connection with the termination of the agency. 13. Finally, it is contended for the assessee that the provisions of S. 10(5-A)(d), which were brought into force with effect from 1st April 1935, could not be employed for the purpose of taxing the entire sum of Rs. 12,500/-in the previous year ending 21st June 1955, inasmuch as at least part of this period, from 23rd March 1953 to 31st March 1955, preceded the date from which S. 10(5-A)(d) came into force. We are not impressed by this contention. The provisions of S. 10(5-A)(d) are applicable to the year for which assessment is made, and it is immaterial that the income in respect of which the assessment is made preceded the enactment of S. 10(5-A)(d). Reliance was placed by the assesse on the decision of the Supreme Court in Income Tax Officer v. S.K. Habibullah, (1962) 44 ITR 803 : ( AIR 1962 SC 918 ) and Second Addl. Income Tax Officer v. Atmala Nagaraj, (1962) 46 ITR 609 (SC). These decisions involved the consideration of S. 35(5) of the Act. which provision is wholly different from S. 10(5-A)(d). We are of the opinion that the entire sum of Rs. 12,500/- could be assessed in the hands of the assessee for the assessment year 1956-57 under S. 10(5-A)(d). We find support for this view from R.V. Lakshmiah v. Commr. of Income Tax, (1963) 48 ITR 661 (Mad). 14. We, therefore, answer the question referred by the Appellate Tribunal in the affirmative. 15. A copy of this judgment under the seal of the Court and the signature of the Registrar shall be sent to the Appellate Tribunal. The Commissioner shall be entitled to his costs which we assess at Rs. 200/-. Counsel's fee is assessed at Rs. 200/-. Reference answered.