TaxTMI 
TaxTMI 
1971 (2) TMI 24
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....come-tax Appellate Tribunal is : " Whether, on the facts and in the circumstances of the case, the Tribunal is correct in holding that the liability for payment of bonus accrued due on the dates on which the provision was made in the balance-sheet of the assessee-company for the three years under appeal irrespective of the fact that the same was actually paid in subsequent years ? " The assessee....
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....d not allow any deduction at all on that account. During the previous year relevant to the assessment years 1961-62 and 1962-63 the assessee actually paid Rs. 1,57,387 and Rs. 2,68,067 respectively as bonus to its employees and those amounts alone were allowed by the Income-tax Officer in the assessments for those years. On appeal by the assessee, the Appellate Assistant Commissioner of Income-tax....
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....he past the practice had been to allow as a deduction the entire amount of bonus due to be paid in the year to which it pertained irrespective of the fact that the bonus was actually disbursed in subsequent years. The appeals were allowed by the Appellate Assistant Commissioner. The Income-tax Officer then appealed to the Income-tax Appellate Tribunal. The Tribunal found that the provision in the ....
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....e of the fact that it was actually paid in subsequent years, the Tribunal dismissed the appeal. After hearing learned counsel for the parties, it seems to us that the Tribunal is right in the approach adopted by it. Upon the finding that the board of directors had authority to declare bonus, it is clear that the liability to pay bonus accrued on the date when the resolution was, passed by the boa....