https://www.taxtmi.com/caselaws?id=276118 Disallowance of directors' commission under rule 12(1) of Schedule I of the Excess Profits Tax Act could not rest merely on the fact that the commission was computed before deduction of excess profits tax. The controlling test was whether the payment was reasonable and necessary having regard to ordinary commercial practice, commercial expediency, the exigencies of the business, and the services actually rendered. As the record showed no finding on those matters, rejection based only on departure from the contractual method of calculation was insufficient and the disallowance was not sustainable. en-us Fri, 22 Mar 1957 00:00:00 +0530 Tue, 30 Oct 2018 14:20:49 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=276118 Disallowance of directors' commission under rule 12(1) of Schedule I of the Excess Profits Tax Act could not rest merely on the fact that the commission was computed before deduction of excess profits tax. The controlling test was whether the payment was reasonable and necessary having regard to ordinary commercial practice, commercial expediency, the exigencies of the business, and the services actually rendered. As the record showed no finding on those matters, rejection based only on departure from the contractual method of calculation was insufficient and the disallowance was not sustainable. Case-Laws Income Tax Fri, 22 Mar 1957 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=276118