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1 - 10 of 16 (0.60 seconds)Section 37 in The Income Tax Act, 1961 [Entire Act]
Section 36 in The Payment Of Bonus Act, 1965 [Entire Act]
Chhaganlal Textile Mills Private Ltd. vs Commissioner Of Income-Tax on 25 April, 1966
In a similar case in Chhaganlal Textile Mills P. Ltd. v. CIT [1966] 62 ITR 274, it was held in that case that the liabilities for which provision was made were only contingent liabilities and cannot be allowed in computing the income, even though the accounts were kept on mercantile basis, as in the present case. The learned counsel for the assessee was unable to convince us on the wording of Section 15(1) of the Bonus Act, that the assessee-company has got a liability to the workers who could enforce the right to receive such bonus in future years. Enforceability by legal process subject to some qualifications is a sine qua non of a legal right which is either enforceable or an assertable claim. Further, in the present case, the said liability, if any, is not an accrued liability. There is nothing on record to hold that the workers are vested with the right to claim the amount of bonus from the assessee and if such claim cannot be legally enforceable, it cannot be said that the assessee was saddled with the liability to pay any bonus as such.
Commissioner Of Income-Tax, Kerala vs Gemini Cashew Sales Corporation, ... on 20 April, 1967
8. On the other hand, the learned counsel for the Revenue, also relying on the provisions of Section 40A as also Section 145 of the I.T. Act, contended that there is no accrued liability in the present case and, consequently, this being a provision made for future contingency, the assessee is not entitled to claim deduction thereof as business expenditure as the amount lay with the assessee-company by way of reserve and in support of his submission, he placed reliance on the decisions in CIT v. Jethalal Zaverchand Patalia [1966] 61 ITR 357 (Guj), CIT v. Sundararaj [1975] 99 ITR 226 (Mad), CIT v. Gemini Cashew Sales Corporation [1967] 65 ITR 643 (SC) and CIT v. Andhra Prabha P. Ltd. [1980] 123 ITR 760 (Mad).
Commissioner Of Income-Tax vs Andhra Prabha P. Ltd. on 27 February, 1979
8. On the other hand, the learned counsel for the Revenue, also relying on the provisions of Section 40A as also Section 145 of the I.T. Act, contended that there is no accrued liability in the present case and, consequently, this being a provision made for future contingency, the assessee is not entitled to claim deduction thereof as business expenditure as the amount lay with the assessee-company by way of reserve and in support of his submission, he placed reliance on the decisions in CIT v. Jethalal Zaverchand Patalia [1966] 61 ITR 357 (Guj), CIT v. Sundararaj [1975] 99 ITR 226 (Mad), CIT v. Gemini Cashew Sales Corporation [1967] 65 ITR 643 (SC) and CIT v. Andhra Prabha P. Ltd. [1980] 123 ITR 760 (Mad).