RAZA TEXTILES LIMITED Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS writ petition is directed against the order dated January 29, 1986, passed by respondent No. 1, the Commissioner (Appeals), Kanpur. By the impugned order, respondent No. 1 has set aside the assessment for further investigation on a limited issue in respect of the petitioner's claim for deduction of an amount as business expenditure representing incentive bonus which had been disallowed by the Inspecting Assistant Commissioner (Assessment), the Assessing Officer.

(2.) BRIEFLY, the facts are that in the assessment year 1980-81, the petitioner made a claim for deduction of Rs. 12,68,683, out of its gross income being the amount paid as incentive bonus to its employees. It appears that a similar claim was also made, though for a different amount, in the assessment year 1981-82. That claim was disallowed on several grounds by the Assessing Officer including that the claim did not satisfy the requisite conditions of Section 36(1)(ii) of the Income-tax Act, 1961 ('the Act'). One such ground for disallowance of the petitioner's claim was that the payments representing incentive bonus were not genuine and it was a bogus claim. The findings recorded in this regard were that relevant entries, instead of being made in the wage registers, were recorded on a separate sheet. The payments were received against thumb impressions. In a large number of cases, the thumb impressions were identical or similar. In the first appeal, these findings were sustained. During the hearing of that appeal, the Assessing Officer was required to submit a remand report It appears that during remand proceedings, an expert's opinion on the genuineness of the thumb impressions was called for. The doubts of the Assessing Officer that in most of the cases the thumb impressions were identical or similar was supported by the said report. The Commissioner (Appeals), after having discussed the remand report and other grounds of disallowance, confirmed the action of the Assessing Officer. As regards the genuineness of the claim, he held as under :

(3.) IT is against the aforesaid order that the present writ petition has been filed seeking a writ of certiorari and a writ of mandamus directing the Commissioner (Appeals) to follow the order of the Tribunal and to grant the petitioner the appropriate relief.