1998 (4) TMI 20

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....ALASUBRAMANIAN J.---The two questions of law referred at the instance of the assessee relating to its assessment year 1976-77 are : "1. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in holding that the payment of commission to the managing director was remuneration for the purpose of section 40(c) of the Income-tax Act, 1961, and consequently e....

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....72,000 and disallowed the sum of Rs. 2,25,662. The Commissioner of Income-tax (Appeals) held that the commission paid to the director cannot be regarded as part of the remuneration and the entire commission should be allowed as a deduction. On further appeal by the Department, before the Income-tax Appellate Tribunal, the Tribunal took the view that the commission should be taken into account f....

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....ing the said decision, we answer the first question of law in the affirmative and against the assessee. In so far as the second question of law is concerned, the issue raised in the question is whether the managing director can be regarded as an employee of the assessee-company or not. The Tribunal found that the managing director was an employee and the assessee had not placed any material to ....