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TMI Blog1990 (6) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... is justified in law in directing that a payment will be an admissible deduction in the assessment year 1981-82 in an order relating to the assessment year 1980-81 ? 3. Whether, on the facts and in the circumstances of the case, the Tribunal is right in law in holding that the limit under the proviso to clause (ii) of section 36(1) of the Act does not apply to the deduction in respect of customary bonus paid to the employees ? 4. Whether, on the facts and in the circumstances of the case, the Tribunal is right in law in finding that such customary bonus does not fall under the purview of the Bonus Act and does not get merged or absorbed by the statutory bonus ?" The respondent/assessee is a public limited company. We are concerned with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner of Income-tax (Appeals) was justified. The Tribunal also made an observation regarding the other payment for the year 1978-79, that it is properly deductible only for the assessment year 1981-82. The Revenue feeling aggrieved (a) by confirmation of the deletion of disallowance made by the Commissioner of Income-tax (Appeals) in the sum of Rs. 1,79,286 relating to the year 1977-78 under the settlement deed dated September 5, 1978, and (b) the observation of the Tribunal that the other payment for the year 1978-79 is properly deductible only for the assessment year 1981-82, formulated certain questions of law for the decision of this court and that is how the above four questions have been referred to this court. We heard counsel for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n exhaustively dealt with by a Bench of this court in P. Alikunju's case [1987] 166 ITR 611. The said decision has been followed subsequently in CIT v. Kumar Industries [1990] 183 ITR 156 (Ker); CIT v. Kerala Agro Industries Corporation [1990] 183 ITR 197 (Ker) and an unreported decision in I. T. R. No. 13 of 1987 since reported in CIT v. Travancore Titanium Products Ltd. [1990] 186 ITR 112 (Ker). Ordinarily, a payment envisaged by the Payment of Bonus Act can be claimed as deduction. Amounts paid over and above the amount payable under the Payment of Bonus Act can be claimed as deduction under section 36(1)(ii) of the Act, provided the following conditions are fulfilled: The amount should be reasonable with reference to (a) the pay of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the assessing authority if it is of the view that a re-evaluation and reappraisal by the assessing authority is required. The Appellate Tribunal also observed that the payment for the year 1978-79 in pursuance to the settlement deed dated September 5, 1978, is one properly deductible only for the assessment year 1981-82. It is only a casual observation towards the close of paragraph 6 of the appellate order dated May 20, 1983. We are of the view that, in considering the quantum of deduction available for the assessment year 1980-81 for which the, accounting period ended on June 30, 1979, any observation to the effect that it is deductible in the subsequent year 1981-82 was unauthorised and uncalled for. The Appellate Tribunal was not ju ..... X X X X Extracts X X X X X X X X Extracts X X X X
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