Law:

Section:

Section 40A(5), read with section 256, of the Income-tax Act, 1961 - Business disallowance - Remuneration, etc, paid in excess of prescribed limits in case of company etc. - Whether in view of decision of this court in Indian Leaf Tobacco Development Co. Ltd. v. CIT [1982] 137 ITR 827, Tribunal was justified in deleting addition made under section 40A(5), and therefore, no referable question of law arose from said order of Tribunal - Held, yes FACTS On appeal the Tribunal deleted the addition made under section 40A(5). The reference afflication filed by the revenue was rejected. On an application under section 256(2): HELD The controversy sought to be raised appeared to be settled by an earlier decision of this Court in the case of Indian Leaf Tobacco Development Co. Ltd. v. CIT [1982] 137 ITR 827, which followed a still earlier decision of this Court in the case of CIT v Kanan Devan Hills Produce Co. Ltd. [1979] 119 ITR 431. In view of aforesaid, instant reference application was to be rejected. Note: The case has been decided in favour of the assessee. CASES REFERRED TO CIT v. Commonwealth Trust Ltd. [1982] 135 ITR 19 (Ker.) [FB], CIT v. Kanan Devan Hills Produce Co. Ltd. [1979] 119 ITR 431(Cal.) and Indian Leaf Tobacco Development Co. Ltd. v. CIT [1982] 137 ITR 827 (Cal.). M.L. Bhattacharya for the Applicant. JUDGMENT Dipak Kumar Sen, J.-The question of law sought to be referred to this court in this application of the Revenue under…

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