J.J. Zand - Page 262

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          July 17, 1978, letter accepting termination, petitioner stated              
          that he agreed with Pioneer that "until such time as we have                
          created a substitute for Diesel Power, which has ceased to exist            
          and operate as the company that I created in 1958, you had no               
          choice but to cancel our agreement."  He further stated:  "I will           
          be creating a representation outlet for your line in Iran * * * .           
          We are not about to leave you without representation as we                  
          continue to feel obligated to serve your interests in Iran."  In            
          a letter dated May 18, 1979, petitioner represented to Pioneer              
          that Diesel Power had no interest in or right to a sales                    
          commission of $121,813.43 earned on a particular order; that CTC            
          was entitled to this commission; and that CTC would hold Pioneer            
          harmless against any claim that Diesel Power might assert with              
          regard to this commission.  Along with a letter 1 week later,               
          Pioneer sent a commission check to petitioner and expressed                 
          regret that this might be the last business transaction between             
          Pioneer and CTC.                                                            
                                P. Payments by Pioneer                                
               In the notice of deficiency for 1973 respondent increased              
          petitioner's income from Pioneer in the amount of $1,440.47.  The           
          1973 CTC receipts journal lists a payment from Pioneer of                   
          $16,838.31.  This payment was deposited in the CTC CNB account.             
          $1,156.75 of this payment is recorded in the CTC receipts journal           







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