1982 (3) TMI 98

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..... to Rs. 22,076, was disallowed. In appeal, the Commissioner (Appeals) found that bonus was paid on Diwali day and it is a customary bonus. Hence, it is allowable. Following the decision of the Supreme Court in the case of Hukumchand Jute Mills v. Industrial Tribunal AIR 1979 SC 876, he allowed the claim of the assessee. Against the same, the revenue is in appeal. 2. The learned departmental repr .....

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..... 72. 3. We have considered the rival submissions. The Commissioner (Appeals) has given a finding that the bonus has been paid on Diwali day and such bonus was paid every year. From the facts, it is clear that bonus paid is a customary bonus. In the case of Hukumchand Jute Mills Ltd. the Supreme Court held that section 17 of the Payment of Bonus Act refers to puja bonus and other customary bonus a .....

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..... f the salary, was allowed as a deduction. The ratio laid down in the above cases squarely applies to the instant case. This is a customary bonus paid by the assessee to its employees and so it is allowable as a deduction. The provisions of section 36(1)(ii) will have no application so far as the customary bonus is concerned. Thus, customary bonus paid is allowable as a business expenditure. Thus, .....

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