https://www.taxtmi.com/caselaws?id=49367 The court interpreted Sections 10(2)(x) and 10(5) of the Indian Income-tax Act in a case involving a company's deduction claim for bonus paid to employees. The court ruled that the liability for the bonus should be attributed to the year 1949, when the claim was settled by an industrial tribunal, not 1947 when it arose under the mercantile system of accounting. It emphasized that the mercantile system requires recognizing liabilities when settled, not when incurred, and distinguished profit bonuses from regular expenses. The court upheld the High Court's decision in favor of the company, affirming the 1949 attribution of the bonus liability. en-us Fri, 17 Apr 1964 00:00:00 +0530 Sat, 23 Aug 2014 12:03:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=49367 The court interpreted Sections 10(2)(x) and 10(5) of the Indian Income-tax Act in a case involving a company's deduction claim for bonus paid to employees. The court ruled that the liability for the bonus should be attributed to the year 1949, when the claim was settled by an industrial tribunal, not 1947 when it arose under the mercantile system of accounting. It emphasized that the mercantile system requires recognizing liabilities when settled, not when incurred, and distinguished profit bonuses from regular expenses. The court upheld the High Court's decision in favor of the company, affirming the 1949 attribution of the bonus liability. Case-Laws Income Tax Fri, 17 Apr 1964 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=49367