1962 (4) TMI 135

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ssioner JUDGMENT The judgment of the court was delivered by V. BHARGAVA C.J.--The question referred for our opinion is: "Whether, on the facts and in the circumstances of the case, the payments of salaries and bonuses made to Madanlal and H.P. Pasari during the period of their jail custody are allowable as deductions under section 10(2)(xv)?" The facts found by the Tribunal on the b....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... plea that the payment was made because these persons were holding posts of responsibility and it was in the interest of the company to continue to pay them their salaries in order to avoid disclosure of company's secrets by them which would have been probable had no payments been made to them. On the material before it, the Tribunal rejected this plea as not established. There was the further....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....m paid to these two persons while they were in jail was expenditure incurred wholly and exclusively for the purpose of the business. It appears from the statement of the case and the appellate order of the Tribunal that an alternative case was also put forward claiming that at least part of the salary paid to these persons should be held to be expenditure made out wholly and exclusively for the....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ts were made by the directors with a different object but it cannot be over- looked that these persons were entitled to leave on full pay for these two periods and, consequently, even if there were no other considerations, they could have claimed their full salary for these periods. The salary paid to them in respect of these periods must, therefore, be held to represent the amount which they were....