Tax Appeals Decided for Assessment Year 1980-81: Disallowances and Payments Resolved

The appeals related to the assessment year 1980-81 involved various issues under the Income Tax Act, 1961. In ITA No. 5131 of 1987, disallowances under different sections were considered, with some disallowances confirmed and others deleted. ITA No. 5382 of 1987 saw the rejection of disallowance of sales incentive expenses and ex gratia payment. In ITA No. 5353 of 1988, the dispute over a payment to a Senior Executive Director was resolved in favor of the assessee. Ultimately, ITA No. 5131 of 1987 was partly allowed, ITA No. 5382 of 1987 was dismissed, and ITA No. 5353 of 1988 was allowed.

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Issues involved:
The judgment involves appeals related to the assessment year 1980-81, with one appeal by the assessee and one by the Revenue against the order of the CIT(A)-XIII, New Delhi, regarding various issues including disallowances under different sections of the Income Tax Act, 1961.

ITA No. 5131 (Del)/1987:
- Ground No.2(a) and (b) - Disallowance under s. 40A(5): The disallowance of Rs. 30,000 for residential accommodation used by the Senior Executive Director was confirmed based on previous Tribunal decisions.
- Ground No. 3 - Disallowance of professional charges: Disallowance of Rs. 10,000 on professional charges was deleted due to lack of evidence for excessive payment.
- Ground No.4(a) and (b) - Business conference expenses: Disallowance of Rs. 69,438 was confirmed based on previous Tribunal decisions.
- Ground No.5(a) - Technical know-how fee: Addition of Rs. 1,13,540 was deleted following a previous Tribunal decision treating similar expenditure as revenue.
- Ground No.5(b) - Depreciation on technical know-how: Dismissed as an alternative ground to 5(a) which was decided in favor of the assessee.
- Grounds No. 6(a) and (b) - Entertainment expenses: Disallowance of Rs. 1,00,725 was confirmed based on previous Tribunal decisions.
- Ground No.17 - Allowance of depreciation: Disallowance of Rs. 24,79,993 was rejected as the assessee had not claimed any depreciation.
- Ground No.8 - Disallowance of bad debts: Disallowance of Rs. 4,217 was deleted as the write-off was considered genuine.

ITA No. 5382 of 1987:
- Ground No. 1 - Sales incentive expenses: Disallowance of Rs. 20,21,736 was rejected based on a previous Tribunal decision.
- Ground No. 2 - Exgratia payment: Dismissed in favor of the assessee based on a previous Tribunal decision.

ITA No. 5353 of 1988:
- Dispute over Rs. 25,000 paid as "good work reward" to Senior Executive Director was resolved in favor of the assessee, as the payment was considered reasonable and in line with previous Tribunal decisions.

In conclusion, ITA No. 5131 of 1987 was partly allowed, ITA No. 5382 of 1987 was dismissed, and ITA No. 5353 of 1988 was allowed.

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