2023 (1) TMI 136 - SCH - Income Tax

Disallowance u/s 36(1)(ii) of bonus paid to Directors - substantial question of law - As per AO bonus was paid to avoid payment of dividend distribution tax - whether the amount paid to the two directors/shareholders in the assessment years 2011-12 and 2014-15 should be allowed as a deduction or should be included in the income of the company? - as decided by HC there is no substantial question of law in the present cases. The assessing officer and CIT (A) have given a concurrent finding that the assessee has paid the bonus in lieu of the dividend and therefore, the above sum is disallowed u/s 36 (1) (ii) - ITAT also after considering the findings of the assessing officer and the CIT (A) had inter alia held that the payment of bonus or commission is not allowable as deduction under Section 36 (1) (ii) of the Act in the hands of the assessing company. In the absence of any substantial question of law, the appeals are liable to be dismissed HELD THAT - There is a concurrent finding of fact by the Assessing Officer, CIT (Appeal) and Income Tax Appellate Tribunal, Delhi which has been duly affirmed by the High Court, disallowing the payment of bonus to the two Directors of the petitioner company No case to interfere with the impugned Order passed by the High Court of Delhi is made out. The Special Leave Petitions are, accordingly, dismissed.

Summary

The Supreme Court of India dismissed the Special Leave Petitions regarding the disallowance of bonus payment to two directors of a company. The decision was based on the concurrent findings of the Assessing Officer, CIT (Appeal), and Income Tax Appellate Tribunal, which were affirmed by the High Court of Delhi.