Law: Income Tax Act, 1922

Section: 66A(2)

Section 36(1)(ii) of the Income-tax Act, 1961 [Corresponding to section 10(2)(x) of the Indian Income-tax Act, 1922] - Bonus or commission - Assessment year 1950-51 - Whether amount paid as bonus by assessee to its workers for calendar year 1947, in terms of an award made in 1949 under Industrial Disputes Act was allowable as deduction in respect of assessment year 1950-51 - Held, yes FACTS The assessee-company owned a textile mill. It had paid bonus to its workers for the calendar year 1947 in terms of an award made in 1949 under the Industrial Disputes Act and claimed it as a deduction in respect of the assessment year 1950-51. The High Court allowed the assessee's claim. On appeal to the Supreme Court: HELD Following the decision and the reasoning in CIT v. Swadeshi Cotton and Flour Mills [1964] 53 ITR 134 (SC), it was held that the High Court was right in allowing the assessee's claim. The appeal was accordingly dismissed. Note: The case was decided in favour of the assessee. CASES REFERRED TO CIT v. Swadeshi Cotton & Flour Mills [1964] 53 ITR 134 (SC) and CIT v. Swadeshi Cotton & Flour Mills [1961] M.P.L.J. 594 (MP). JUDGMENT Sikri, J.-The point involved in this appeal is the same as in Commissioner of Income-tax v. Swadeshi Cotton and Flour Mills [1964] 53 ITR 134 (SC), in which we have just delivered judgment. This appeal was filed in this court after obtaining a certificate under section 66A(2) of the Income-tax Act, 1922, and is directed against the…

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