1978 (8) TMI 1

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....of the court was delivered by P. N. BHAGWATI J. --The assessment years with which we are concerned in these appeals are 1956-57, 1957-58, 1958-59 and 1959-60, for which the relevant accounting years were the financial years ending 31st March, 1956, 31st March, 1957, 31st March, 1958, 31st March, 1959, respectively. The only question which arises for consideration in these appeals is whether the....

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....ing regard to the legitimate business needs of the assessee and the benefit derived by or accruing to it therefrom and he, therefore, disallowed the amounts of Rs. 46,162, Rs. 45,753, Rs. 42,967 and. Rs. 46,720 out of such remuneration and commission under section 10(4A). The view taken by the Income-tax Officer was confirmed in appeal by the Appellate Assistant Commissioner but on further appeal,....

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....ial interest in the assessee and hence section 10(4A) had no application in relation to him and so far as the four directors were concerned, though section 10(4A) was applicable, there was nothing to show that the payment of commission and remuneration to them was excessive or unreasonable and hence the Tribunal was right in holding that the disallowance of various amounts out of the remuneration ....

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....nt years in question ranged between Rs. 23,66,000 to Rs. 30,86,000 and the assessee had two producing centres, one at Fattabad and the other at Ghoom in Darjeeling district, and also several other distributing centres. And despite this huge annual turnover and large number of centres to look after and supervise, the assessee incurred a total expenditure of not more than Rs. 5,000 per month at the ....