Amounts credited to the bonus reserve account have been allowed by way of deductions under section 36(1)(ii) of the Income-tax Act, 1961

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... amounts credited to the bonus reserve account have been allowed by way of deductions under section 36(1)(ii) of the Income-tax Act, 1961 in the assessment year while computing the total income. 2. If an employer maintains his books on the mercantile system of accounting, he is entitled to a deduction in respect of the bonus in the year in which he admits the employees' claim or the claim is adj .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ard to four accounting years for being utilised for the payment of bonus in those years. Reserves for bonus made in the aforesaid circumstances or otherwise are not to be allowed as a deduction till the claim materializes in the manner mentioned in the opening sentence of this para. The claims for bonus expenditure should be carefully scrutinised in this context and necessary disallowances made. .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X