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1 - 10 of 10 (0.19 seconds)The Income Tax Act, 1961
Section 15 in The Payment Of Bonus Act, 1965 [Entire Act]
Section 11 in The Payment Of Bonus Act, 1965 [Entire Act]
Section 10 in The Payment Of Bonus Act, 1965 [Entire Act]
Section 37 in The Payment Of Bonus Act, 1965 [Entire Act]
Section 256 in The Income Tax Act, 1961 [Entire Act]
Section 28 in The Payment Of Bonus Act, 1965 [Entire Act]
Rayalaseema Mills Limited vs Commissioner Of Income-Tax, Andhra ... on 19 June, 1984
11. Our attention has been drawn to the decision of the Andhra Pradesh High Court which in Rayalaseema Mills Ltd. v. CIT [1985] 155 ITR 19, considered a similar question. There the contention raised was that although the deduction does not fall under Section 37, not being an expenditure laid out or expended by the assessee, it was nevertheless allowable under Section 28 on the reasoning that the amount is diverted under an overriding legal obligation. Repelling that contention, the court proceeded to hold (headnote) :
Malwa Vanaspati & Chemical Co. Ltd. vs Commissioner Of Income-Tax on 17 July, 1984
10. Our attention has been drawn to the decision of the Madhya Pradesh High Court in Malwa Vanaspati and Chemical Co. Ltd. v. CIT [1985] 154 ITR 655. There, the court held that "set on" bonus under Section 15(1) of the Payment of Bonus Act is not a subsisting liability as such for the accounting year but it is a contingent liability. It is merely a reserve fund which the assessee has to create by reason of the provisions of Section 15(1) of the Payment of Bonus Act. The court held that under Section 37(1), a connection has to be established between the expenditure incurred and the business activity undertaken by the assessee with such object which is wanting in the present case.
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