9911796707
TMI Blog1997 (3) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... e instance of the Revenue, the Appellate Tribunal has stated a case and referred the following three questions of law for the assessment year 1978-79 under section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"): "1. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the payment of incentive bonus in excess of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee-company dated November 12,'1977. We have taken a view in T. C. No. 984 of 1985 (CIT v. Bhavani Mills Ltd. [1999] 237 ITR 855 (Mad), by judgment of even date that the incentive bonus paid is not allowable under the provisions of section 36(1)(ii) of the Act, but it is allowable under the provisions of section 37 of the Act. The Tribunal has come to the correct conclusion and held that the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e lower figure. We answer the second question in the affirmative and against the Revenue. The third question relates to the payment of guarantee commission paid to a bank for purchase of capital asset is allowable as business expenditure. This court in Sivakami Mills Ltd. v. CIT [1979] 120 ITR 211, has held that the guarantee commission paid is allowable as business expenditure. Mr. C. V. Rajan, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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