Deductibility of employee remuneration as business expenditure is ordinarily a factual question, with the taxpayer bearing the burden of proof.

Whether remuneration or commission is deductible as expenditure laid out wholly and exclusively for business purposes depends on the nature of the services rendered, the scale of the business, and the quantum of payment. That assessment is ordinarily a factual one for the income-tax authorities, and the assessee bears the burden of proving the facts necessary to support the deduction. On the materials before them, the authorities could conclude that the claimed commission was not wholly deductible, so no question of law arose and no direction to state a case was warranted; the disallowance of part of the commission remained undisturbed.

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Issues: Whether the extent to which remuneration paid to an employee is allowable as deduction under section 10(2)(xv) of the Income-tax Act, 1922 is a question of fact or law, and whether the Appellate Tribunal could be directed to state a case when it treated the allowance as partly disallowable.

Analysis: The determination of what amount of remuneration is laid out wholly and exclusively for the purposes of the assessee's business depends on the nature of the services rendered, the extent of the business, and the quantum of payment. Such assessment is for the taxing authorities to make on the facts before them. The authorities were found to have material on which to conclude that the commission claimed was not wholly deductible, and the assessee bore the burden of establishing the facts necessary to justify the deduction.

Conclusion: The issue was held to be one of fact, not law, and no direction to state a case was warranted.

Final Conclusion: The petition failed and the rule was discharged with costs, leaving the disallowance of a portion of the commission undisturbed.

Ratio Decidendi: The question whether expenditure is wholly and exclusively laid out for the purposes of business, and the extent of deduction allowable on that basis, is ordinarily a question of fact for the income-tax authorities, not a question of law.

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