9911796707
TMI Blog1979 (11) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 2,000 per month and commission at the rate of 4% of the net profit of the company. Whereas, according to the assessee, the provisions of s. 40A(5) of the Income-tax Act, 1961 (hereinafter called " the Act "), permitted salary and other remunerations in respect of a director to the tune of Rs. 72,000 per annum, according to the ITO, the maximum permissible salary was actually Rs. 60,000 per annum. The Tribunal allowed a deduction of the sum of Rs. 72,000 to the assessee. In respect of the dispute regarding relief under s. 80J of the Act pertaining to assessment year 1973-74, it was accepted by the parties that the judgment of this court in CIT v. Patiala Flour Mills Co. (P.) Ltd. [1978] 113 ITR 55 covered the issue in favour of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich results directly or indirectly in the payment of any salary to an employee or a former employee, or (ii) incurs any expenditure which results directly or indirectly in the provision of any perquisite (whether convertible into money or not) to an employee or incurs directly or indirectly any expenditure or is entitled to any allowance in respect of any assets of the assessee used by an employee either wholly or partly for his own purposes or benefit, then, subject to the provisions of clause (b), so much of such expenditure or allowance as is in excess of the limit specified in respect thereof in clause (c) shall not be allowed as a deduction : Provided that where the assessee is a company, so much of the aggregate of (a) the expendit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenditure or is entitled to any allowance in respect of any assets of the assessee used by an employee either wholly or partly for his own purpose or benefit then, subject to the provisions of cl. (b), so much of such expenditure or allowance its is in excess of the limit specified in respect thereof in cl. (c) shall not be allowed as deduction. The proviso has been made whereby it has been provided that where the assessee is a company, in that case so much of the aggregate of the expenditure and allowance reffered to in in sub-cls. (i) and (ii) of sub-s. (5)(a) and the expenditure and allowance referred in sub-cls. (i) and (ii) of cl. (c) of s. 40 of the Act in respect of an employee or a former employee, being a director or a person who ..... X X X X Extracts X X X X X X X X Extracts X X X X
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