9911796707
TMI Blog1981 (8) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... s to the assessment years 1973-74 and 1974-75 for which the corresponding previous years are the financial years ending on 31 st. March, 1973, and 31st March, 1974, respectively. In the appeals which were filed by the assessee for these two years the Tribunal was called upon to decide two issues: one relating to the curtailment of the deduction in respect of the managing director's salary from Rs. 42,350 per annum as claimed, to Rs. 36,000 per annum under the provisions of s. 40(c) and the other regarding the disallowance of Rs. 14,572 (for the assessment year 1973-74) and Rs. 15,295 (for the assessment year 1974-75) being the deduction claimed by way of gratuity liability under the Compulsory Gratuity Act, 1971. In so far as the first of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessment year 1970-71. He has also not been able to show any improvement in the business of the assessee-company in the assessment years under consideration. We, therefore, do not find any reason to take a view different from what the Tribunal has taken from the assessment years 1970-71 to 1972-73. We, therefore, affirm the orders of the Appellate Assistant Commissioner. It appears that the previous years' assessments were concerned really with the assessment years 1967-68, 1968-69 and 1969-70. The decision of the Tribunal for these assessment years came up for consideration before this court in Eastern Scales (P.) Ltd. v. CIT[1979] 117 ITR 477. There is, however, one significant factor different from those years, in the present year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the Rani and her advice and decision in all such matters were of vital importance in guiding the affairs of the company and its smooth and efficient administration. Among the directors there might be a division of labour for the efficient administration of the affairs of the company and there might be a managing director with larger powers and greater responsibility in the matter of management of the affairs of the company. Therefore, in these circumstances, the court upheld the decision of the Tribunal that the disallowance of the amounts paid to the directors under s. 10(4A) was unjustified. But this court in the case of Eastern Scales (P.) Ltd. [1979] 117 ITR 477, after referring to the aforesaid decision in the case of Edward Kevente ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d at an incorrect decision and the question must, therefore, be answered in the negative and in favour of the assessee. Before we part with, however, we must observe that in our decision in the case of Eastern Scales (P.) Ltd. v. CIT [1979] 117 ITR 477 at p. 486, we had inadvertently observed that in the case before this court, in CIT v. Edward Keventer P. Ltd. [1972] 86 ITR 370, the attention of the Division Bench was not drawn to the decision of the Supreme Court in the case of Nund Samont Co. (P.) Ltd. v. CIT [1970] 78 ITR 268, though the judgment of the Supreme Court was delivered on the 6th May, 1970. This seems to be an inadvertent error because we find that in the decision of the Division Bench of this court in the case of CIT v. E ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
