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TMI Blog1973 (11) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... incorporating its findings on the following points : (i) Was there any existing liability incurred by the company during the accounting period or whether what had been done by the assessee was only to make a provision for a contingent or future liability ? (ii) Was the deduction claimed by the assessee in respect of any item of expenditure during the relevant accounting period ? The question referred to this court for the year of assessment 1963-64 was this: " Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is justified in law in allowing the amount of Rs. 11,400 being the gratuity to Shri K. A. Varugis for the assessment year 1963-64 ? " In the supplementary statement of the case dated Aug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profit and loss account as well as the schedule to the balance-sheet and that these documents had been produced before the Tribunal and the evidence furnished by these documents had not been adverted to in entering the findings on the two points which we had extracted earlier in the judgment. Counsel urged that the general authority of directors extended to all acts which were necessary for management and they had, therefore, authority in a prosperous year to give the company's servants gratuity from its profits and that this principle is well accepted and will apply to the decision of the directors to grant gratuity to the retiring director; so it was contended that when the directors took the decision on or before December. 31, 1962, to p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see. This not having been taken into account, it is further urged that the findings cannot stand and we have, therefore, been asked to follow the procedure which the Supreme Court did in the decisions in Commissioner of Income-tax v. Greaves Cotton Co. Ltd. and Commissioner of Income-tax v. Indian Molasses Co. P.Ltd. In Commissioner of Income-tax v. Greaves Cotton Co. Ltd., the Supreme Court said: " We have therefore reached the conclusion that the question of law referred to the High Court cannot be answered in view of the defective finding by the Appellate Tribunal which is recorded without consideration of all the evidence. It will be open to the Appellate Tribunal to rehear the appeal under section 66(5) of the Act and record ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly and exclusively for the purpose of the business of the company and has not considered all appropriate provisions of the statute applicable thereto. It will be open to the Tribunal to dispose of the appeal under section 66(5) of the Indian Income-tax Act, 1922, in the light of the observations made by this court after determining the questions which ought to have been decided. " There is no reference whatever in the long supplementary statement of the case dated August 31, 1971, to the profit and loss account or the balance-sheet of the company which was produced before the Tribunal. This should have been referred to and considered. The documents furnished very relevant material for entering findings on the points and the schedules to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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