2025 (2) TMI 1516

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....assed under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') relating to the Assessment Year 2015-16. 2. The registry has noted that there is a delay of 124 days in filing the above appeal. The assessee filed Notarized sworn Affidavit of its Accountant, wherein he has stated that due to tax audit finalization of accounts, he failed to communicate the appellate order to the Chartered Accountant. However on receipt of penalty notice u/s. 271DA of the Act for the other Asst. Year 2018-19, he realized that the appeal is not filed and immediately thereafter approached their Advocate for filing the appeal which has resulted in delay of 124 days. We are satisfied with the reasons stated and the delay in filing t....

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.... is an essential factor to consider in managing a business. While it is crucial to provide incentives to those performing the challenging role of managing the companies it is equally important not to exceed reasonable limits with perks and pay (Since in a public limited company remuneration has to be restricted to 11% of Net profit it works out to roughly Rs. 750000 whereas taxpayer has debited Rs. 2000000 to Director. This is more than double that claimable. As mentioned here if the taxpayer is a public limited company remuneration is to be restricted to 11% of Net Profit. Whereas if the taxpayer is a private ltd company there is no restriction. But going by the facts of the case since Incentive is linked to profit and profit has not shown....

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....eave to add, amend or alter the grounds of appeal at the time of hearing, if need arise. Revised Grounds: 1. The Ld. CIT(A) has erred in law and on facts of the case, in sustaining the disallowance of payment of incentive to the directors of the assessee company to the extent of Rs. 13,62,000/-. 6. Heard rival submissions at length and perused the materials available on record including the submissions of both parties and Paper Book filed by the assessee. The Ld. CIT(A) in his order mentions that as per the Company's Act, remuneration to managers is restricted to 11% of the Net Profit when it is Public Limited Company. However the Ld. CIT(A) observed that it is not clear whether the assessee is a Public Limited Company ....