TMI Blog1975 (9) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... rom service during the year is an allowable deduction in computing the agricultural income of the assessee ?" The relevant facts have been stated in paragraphs 2, 3 and 4 of the statement of the case which are in these terms : 2. The Vellimala Estate is a firm and an assessee borne on the files of the Agricultural Income-tax Officer, Kottarakara. For the year ended October 31, 1966, relevant for the assessment year 1967-68, it filed returns declaring a net income of Rs. 1,57,600. The Agricultural Income-tax Officer did not accept the accounts and other records produced in support of the returns as correct and complete for the reasons stated by her in the assessment order. Rejecting them and the returns she finalised the assessment, esti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee-firm came up in second appeal before us raising various contentions including that regarding the payment of gratuity and arrears of bonus to the employees. A detailed statement showing the persons to whom such payments were made, their respective years of service and the reasons for payments were furnished before us at the time of hearing. This statement was perused at the time of hearing and no objection was raised in this regard by the learned representative for the State. Based on the same and the arguments of both sides, the Tribunal found as follows : 'The third point raised is that regarding the disallowance of gratuity and arrears of bonus, etc., amounting to Rs. 4,322.36 paid during the year. Details of the persons to whom s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ars of service, and the reason for payments have been furnished before us........" What are those reasons have not been stated in the order nor have those reasons been discussed by the Tribunal in the order. We are not in a position, therefore, to consider whether the payments were in any way connected with the future conduct of the business of the assessee. Nor are we able to find whether the payments could be supported on the principle of commercial expediency. In these circumstances we are unable to answer the question that has been referred to us. We think the procedure to adopt in such cases is what has been done by the Supreme Court in the decision in Commissioner of Income-tax v. Greaves Cotton Co. Ltd. [1968] 68 ITR 200, 209 (SC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y Red Dye Works Co. Ltd. v. Commissioner of Income-tax [1963] 48 ITR 92 (SC) and Keshav Mills Co. Ltd. v. Commissioner of Income-tax [1965] 56 ITR 365 (SC), be restricted to the evidence on the record and may not be entitled to take additional evidence. That may result in injustice. In the circumstances, we think it appropriate to decline to answer the question on the ground that the Tribunal has failed to consider and decide the question whether the expenditure was laid out or expended wholly 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 A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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