TMI Blog2003 (2) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... ction for the assessment years 1978-79 and 1979-80?" - Question No. 1 In the affirmative and in favour of the assessee. - Question No. 2 In the negative and in favour of the Revenue. - Question No. 3: In the negative and in favour of the Revenue. - - - - - Dated:- 5-2-2003 - Judge(s) : S. H. KAPADIA., J. P. DEVADHAR. JUDGMENT The judgment of the court was delivered by J.P. DEVADHAR J.-At the instance of the Commissioner of Income-tax, Bombay City-II, Bombay, the Income-tax Appellate Tribunal has referred following questions for the opinion of this court under section 256(1) of the Income-tax Act, 1961. Assessment year 1978-79: Question No. 1: "Whether, on the facts and circumstances of the case, initial contribution by the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Payment of Bonus Act, 1965, and, therefore, the said amount of Rs. 22,81,847 given to the textile mill workers over and above the statutory bonus was not liable either under section 36(1)(ii) or under section 37(1) of the Income-tax Act. On appeal, the Commissioner of Income-tax (Appeals) held that the said amount was liable to be deducted as necessary business expenditure incurred in the interest of business expediency and for coming to terms with the Rashtriya Mazdoor Sangh. On further appeal, the Tribunal held that the additional payment of bonus was on account of the agreement between the Mills Owner's Association and the employees union and hence, deductible under section 36(1)(ii). The Tribunal further held that the assessee's case w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 80G applies to the aggregate of the sums in respect of which deduction is claimed and not to the amount of deduction allowed under sub-section (1) of section 80G of the Income-tax Act. In the present case, the Tribunal following the decision of the Andhra Pradesh High Court in the case of Hyderabad Race Club v. Addl. CIT [1979] 120 ITR 185, held that the ceiling laid down by sub-section (4) was applicable not to the aggregate amount in respect of which the deduction was claimed but to the amount deductible under sub-section (1) of section 80C. However, this court in the case of CIT v. New Shorrock Spg. and Mfg. Co. Ltd. [1995] 212 ITR 355 has disagreed with the decision of the Andhra Pradesh High Court in the case of Hyderabad Race Clu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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