https://www.taxtmi.com/caselaws?id=8410 The court ruled in favor of the assessee, affirming that the liability for payment of bonus accrued when the board of directors passed the resolution, despite actual payment occurring in subsequent years. The court upheld the deductions for bonus amounts provided in the account books based on the mercantile system of accounting, emphasizing that the liability arose when the obligation to pay was established. The decision aligned with past practices of allowing the entire amount of bonus due to be paid in the year it pertained to, regardless of the payment timing, and any undisbursed amount from the provision was to be added back as income. en-us Fri, 12 Feb 1971 00:00:00 +0530 Sat, 11 Apr 2009 12:27:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=8410 The court ruled in favor of the assessee, affirming that the liability for payment of bonus accrued when the board of directors passed the resolution, despite actual payment occurring in subsequent years. The court upheld the deductions for bonus amounts provided in the account books based on the mercantile system of accounting, emphasizing that the liability arose when the obligation to pay was established. The decision aligned with past practices of allowing the entire amount of bonus due to be paid in the year it pertained to, regardless of the payment timing, and any undisbursed amount from the provision was to be added back as income. Case-Laws Income Tax Fri, 12 Feb 1971 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=8410