TMI Blog1987 (12) TMI 73X X X X Extracts X X X X X X X X Extracts X X X X ..... head "Production Bonus (Factory)", Rs. 1,49,508 under the head "Production Bonus (Foundry)", Rs. 18,24,284 under the head "Productivity Payment" and Rs. 4,35,081 under the head "attendance Incentive Bonus". The Assessing Officer observed that these payments were made to the staff and workers over and above the profit sharing bonus of Rs. 13,333,965 as addition payments by way of incentive under different nomenclatures. The assessee contended that the these payments were in the nature of incentive wages based on agreed formulations to boost production and, therefore, they formed part of their total earnings for the services rendered by them. The assessing Officer noticed that for the purpose of employees' provident fund contribution, gratui ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profits payable under the said Act. According to the second proviso to the said section, the employees shall not be entitled to be paid such bonus in excess of 20 per cent of the salary or wages earned by them during the relevant accounting year. In the case, the employees have already been paid the maximum amount of bonus payable under the Payment of Bonus Act. So, any further amounts under any name, whatsoever, cannot be allowed as a deduction. Accordingly, the order of the Assessing Officer should be restored. 10. The assessee's learned counsel urged that these amounts have been allowed by the Tribunal in the assessee's case for the asst. yr. 1980-81 vide paragraphs 2 and 9 of their order dt. 10th Nov., 1986 and that the same may be f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the Payment of Bonus Act 1965. In that order, they relied on the decision of the Tribunal in the case of ITO vs. Gopalpur Tea Co. Ltd. (1985) 12 ITD 259 (Cal) (TM) and the decision of the Madras High Court in the case of CIT vs. Sivanadha Mills Ltd. (1985) 156 ITR 629 (Mad). In the case of Sivanandha Mills Ltd. the High Court was considering the incentive bonus, attendance bonus and customary bonus. They did not consider the productivity or production oriented bonus under s. 31A of the Payment of Bonus Act, 1965. So, this decision is not helpful to the assessee for production bonus and productivity bonus. In the case of Gopalpur Tea Co. Ltd. the bonus at the rate of 8.33 per cent of the wages was paid as per settlement arrived at bet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent order that the fees paid to IC ICI Ltd. was for financial consultancy in connection with raising of loans and issue and subscription of new shares. According to him, it was in the nature of capital expenditure. So, he disallowed the said amount. The CIT(A) following the decision of the Supreme Court in the case of India Cements Ltd. vs. CIT (1966) 60 ITR 52 (SC) deleted the said allowance. 17. The Departmental Representative urged that the deletion of the disallowance was not in order as per the decision of the Calcutta High Court in the case of Brooke Bond India Ltd. vs. CIT (1982) 28 CTR (Cal) 245 : (1983) 140 ITR 272 (Cal). The assessee's counsel contended that the decision of the CIT(A) was in order as it was in consonance with ..... X X X X Extracts X X X X X X X X Extracts X X X X
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