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TMI Blog1984 (5) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... us Act, 1965. For the asst. yr. 1980-81 (year ending 31st March, 1980), the assessee paid bonus of Rs. 29,532 under the Payment of Bonus Act to its 57 employees. It also paid customary bonus of Rs. 11,220 to its employees for Deepawali. The ITO aggregated the two sums at Rs. 40,852 and disallowed bonus in respect of 29 employees on the ground that it was in excess of 20 per cent of the salary unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a of the bigger HUF (including minor Sankaran) is a partner in the assessee firm. The firm borrowed money from Sahasranamam, Karta of the smaller HUF (excluding the minor Sankaran) and paid interest of Rs. 45,000. The ITO disallowed the above interest payment under s. 40 (b), relying on the Allahabad High Court decision in (1979) 10 CTR (All) 301 : (1979) 117 ITR 111 (All). CIT vs. London Machinar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e firm. This decision is distinguishable on fact, since in the present case the interest in question has not been paid to the individual partner but to the smaller HUF. A similar issue was considered by the Gujarat High Court in the case of CIT vs. Sajjan Raj Divan Chand (1981) 21 CTR (Guj) 26 : (1980) 126 ITR 654 (Guj). The facts in this case were that the assessee firm had three partners out of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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