1968 (11) TMI 12

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... m - so it is allowable as deduction form his share income - - - - - Dated:- 25-11-1968 - Judge(s) : VEERASWAMI., RAMAPRASADA RAO. JUDGMENT The judgment of the court was delivered by VEERASWAMI J.-We do not think there is much in this reference. The question referred to us is : " Whether, on the facts and in the circumstances of the case, the Tribunal was right in allowing the claim of .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... d with the cinema business. It contained a further provision : " Sri S. K. Kalyanasundaram Pillai is to operate on bank accounts and shall have control over the entire management and Sri S. Meyyappan is to look after the work in connection with the production or supervision of productions at Madras and render his full services for which he is entitled to half share of profits. " The Tribunal h .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... been arrived at after allowance of expenses permissible under section 10 of the Act in the hands of the firm. For the subsequent two years also, the Officer took a similar view. The Appellate Assistant Commissioner differed, with whom the Tribunal agreed. That is how the reference has been initiated by the Commissioner of Income-tax. Basantlal Gupta v. Commissioner of Income-tax held that it cou .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... pervision and management of the firm's business, which was the duty of the assessee to perform under the terms of the partnership and, therefore, in that sense, the expenditure could properly be deducted only from the income of the firm, and it could not said to be expenditure incurred for purposes of earning the assessee's share income in the firm. It seems to us that the question is one more of .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... loying some one and, for that purpose, incurred expenditure, it is obvious that the expenditure has been incurred for the purpose of rendering the service to the firm on his behalf which alone would entitle him to his half share of the profits. The expenditure is, therefore, one incurred for the purpose of the assessee earning a half share of the profits in the firm. The question is answered aga .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X