1984 (5) TMI 115

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....presenting payment of bonus in excess of the limit specified in the payment of Bonus Act, 1965. For the asst. yr. 1980-81 (year ending 31st March, 1980), the assessee paid bonus of Rs. 29,532 under the Payment of Bonus Act to its 57 employees. It also paid customary bonus of Rs. 11,220 to its employees for Deepawali. The ITO aggregated the two sums at Rs. 40,852 and disallowed bonus in respect of ....

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.... paid to S. Sahasranamam, smaller HUF, should be sustained, Sri. Sahasranamam, Karta of the bigger HUF (including minor Sankaran) is a partner in the assessee firm. The firm borrowed money from Sahasranamam, Karta of the smaller HUF (excluding the minor Sankaran) and paid interest of Rs. 45,000. The ITO disallowed the above interest payment under s. 40 (b), relying on the Allahabad High Court deci....

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....rs in their capacity of Kartas of HUFs and had invested their individual money in the firm. This decision is distinguishable on fact, since in the present case the interest in question has not been paid to the individual partner but to the smaller HUF. A similar issue was considered by the Gujarat High Court in the case of CIT vs. Sajjan Raj Divan Chand (1981) 21 CTR (Guj) 26 : (1980) 126 ITR 654 ....