Strict construction of taxing law bars deduction of commission paid by a firm to its partners through partner-owned concerns.

Section 10(4)(b) of the Income-tax Act, 1922 was construed strictly to bar deduction of commission paid by a firm to its partners, including amounts routed through concerns owned by them. The court applied the plain language of the taxing provision and refused to read in a limitation confining the prohibition to payments made only in a partner's formal capacity. On the facts, the commission paid to the partners' businesses was treated in substance as payment to the partners themselves, so the amounts were not admissible deductions.

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Issues: Whether commission paid by a firm to concerns owned by its partners falls within the prohibition in section 10(4)(b) of the Income-tax Act, 1922, so as to disallow deduction.

Analysis: Section 10(4)(b) was introduced to remove uncertainty in the allowance of payments by a firm to its partners. The provision uses clear words and does not distinguish between payments made to a partner in his capacity as a partner and payments made to him in another character. In a taxing statute, nothing can be read in and nothing can be implied; the Court must look only at what is clearly stated. On the facts, the amounts were paid as commission to businesses owned by the partners, and the payment was in substance a commission payment to partners of the firm.

Conclusion: The commissions were payments by a firm to its partners within section 10(4)(b) of the Income-tax Act, 1922, and were not admissible deductions.

Ratio Decidendi: Where the language of a taxing provision expressly disallows payments by a firm to any partner by way of commission, the Court will apply the provision according to its plain terms without adding words that limit it to payments made only in the capacity of partner.

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