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<h1>High Court upholds disallowance of pension payments to deceased chairman's widow</h1> The High Court of Madras upheld the disallowance of pension payments to the widow of a deceased chairman due to lack of agreement and employment status, ... Deductibility of pension payments - Pension paid to widow of non-employee - Employer-employee relationship as prerequisite for pension deduction - Obligation or contractual agreement for pension - Application of earlier precedentDeductibility of pension payments - Pension paid to widow of non-employee - Employer-employee relationship as prerequisite for pension deduction - Disallowance of Rs. 60,000 for 1977-78 and Rs. 55,000 for 1978-79 as pension paid to the widow in computing the income of the assessee-company was justified. - HELD THAT: - The Tribunal and the authorities below disallowed the claimed deduction on the ground that there was no agreement between the company and the deceased chairman for payment of pension and that the deceased was not an employee of the company; accordingly the payments could not be treated as pension to the widow for deduction. The High Court held that the present facts were similar and identical to an earlier decision involving the same assessee, and accordingly followed that precedent , answering the referred question in the affirmative and against the assessee. The court therefore approved the view that in the absence of an obligation or employer-employee relationship entitling pension, the payments could not be allowed as deductible pension payments in computing the company's income for the specified years.Referred question answered in the affirmative; disallowance upheld for 1977-78 and 1978-79.Final Conclusion: The court upheld the disallowance of the payments as pension to the widow for the assessment years 1977-78 and 1978-79, following the earlier decision, and answered the referred question in the affirmative and against the assessee; no costs. The High Court of Madras was asked whether the disallowance of pension payments to the widow of a deceased chairman was correct. The court upheld the disallowance, citing lack of agreement and employment status. The decision was based on a similar case precedent.
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