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TMI Blog2020 (12) TMI 1186X X X X Extracts X X X X X X X X Extracts X X X X ..... pertained to the year under consideration. The assessee has refunded the excess amount of salary to the company and filed revised return of income showing the actual amount of salary received as approved by the Ministry of Corporate Affairs, Govt. of India. However, the Assessing Officer has taxed the excess amount as salary income on the ground that the amount was received by the assessee. The ld. CIT(A) has deleted the addition holding that refund of salary by the assessee was not voluntary but was to comply with the legal requirements of law, therefore, the same cannot be considered as income assessable to tax In the case of the assessee, the Central Government had decided the remuneration according to the provisions of Companies Act, 1956 and the refund of the salary was not voluntary but was to comply with the legal requirement of law. We find that the facts and issue involved in the case of the assessee are similar to the case of the CIT Vs. Raghunath Murti [ 2008 (8) TMI 996 - DELHI HIGH COURT] . We consider that the refund was made merely with a view to comply with the provisions of Companies Act, 1956, therefore, we do not find any infirmity in the decision of ld. CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if considered as 'not due'. 1.4 That in the facts and circumstances of the case and in law, the Ld. CIT (A) erred in deleting the addition towards salary without considering that alternatively and without prejudice, the perquisite value of interest was taxable as the assessee had not stated that any interest was charged by the employer even though the amount was substantial, for the long period this was used by the assessee. Relief claimed in appeal It is prayed that the order of the CIT (Appeals) on the above issue be set aside and that of the Assessing Officer be restored. 3. All the grounds of appeal filed by the Revenue are interconnected to the issue of deleting the addition towards salary, therefore, for the sake of convenience, all these grounds of appeal are adjudicated together as under:- 4. The fact in brief is that the assessee has filed return of income on 24th July, 2014 declaring total income at ₹ 3,34,54,360/-. Subsequently, the assessee has filed revised return of income on 29th March, 2016 showing total income of ₹ 1,34,88,102/-. The case was subject to scrutiny assessment and notice u/s. 143(2) was issued on 20th Sep, 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd No. 1 to 4 are pertaining to addition of ₹ 1,99,66,259/- being the amount of salary refunded to the employer company. Undisputedly, the appellant was working as Whole Time Director (WTD) with Sun Pharma Advanced Research Company Ltd. (SPARCL) and his remuneration was fixed at maximum salary of ₹ 3,50,00,000/- in AGM dated 31.07.2012 subject to the following conditions:- Minimum Remuneration - In the event of loss or inadequacy of profit in any financial year, Dr. T. Rajamannar should be entitled to receive a total remuneration including perquisites, etc. not exceeding the salary limits as approved by Remuneration Committee and by the Central Government, where necessary as minimum remuneration . In view of the above, employer company made a reference to the Central Government and the Central Government vide its letter No. SRN B82817776/2013-CL-VII dated 30.12.2013 approved appointment as a Whole Time Director for a period from 04.06.2013 to 03.06.2016 at a maximum remuneration of ₹ 84,00,000/- per annum. Thereafter, the employer company made further representation before the Ministry of Corporate Affairs on 30.10.2014 for enhancement of the above men ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refunded excess salary of ₹ 10,17,112/- and as a result thereof revised return was filed on 16.08.1999. In view of the above facts, the Hon'ble Court has held that the refund of salary was neither voluntarily nor was it for any extraneous consideration and in fact, the refund was made merely with a view to comply with the provisions of Companies Act, 1956. Therefore, net amount of the salary was only taxable. The facts of the case of the appellant before me, are identical and hence I also hold that remuneration to the appellant was not due more than what was approved by the Government of India, Ministry of Corporate Affairs, New Delhi and hence amount of the refund was not voluntarily but to comply with the provisions of Companies Act, 1956. Accordingly, I further hold that only the net amount of the salary after deducting the refund amount is taxable and hence the addition made by the Assessing Officer is directed to be deleted. Thus, appellant succeeds on this account. 6. During the course of appellate proceedings before us, the ld. Departmental Representative has supported the order of Assessing Officer. On the other hand, ld. ld. counsel has supported the o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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