REGENT COMPUTRONICS PVT. LTD.

RASIKLAL And CO. Appellant

V/S

COMMISSIONER OF INCOME TAX Respondents

Referred Judgements :-

CIT VS. LONDON MACHINERY CO. [REFERRED TO (ALL) 301 : (1979) 117 ITR 111 (ALL),]
PANNALAL GIRDHARILAL VS. COMMISSIONER OF INCOME TAX [REFERRED TO (DELHI),]
K C RAJ AND CO VS. COMMISSIONER OF INCOME TAX NEW DELHI [REFERRED TO(DELHI),]
SANGHI MOTORS VS. COMMISSIONER OF INCOME TAX [REFERRED TO : (1982) 135 ITR 359 (DELHI),]
CHHOTALAL AND COMPANY VS. COMMISSIONER OF INCOME TAX [REFERRED TO (FB) : (1984) 150 ITR 276 (GUJ) (FB),]
COMMISSIONER OF INCOME TAX VS. HARI NATH AND CO [REFERRED TO : (1987) 168 ITR 440 (ALL) AND]
COMMISSIONER OF INCOME TAX VS. NITRO PHOSPHETIC FERTILIZER [REFERRED TO: (1988) 74 ITR 269 (ALL) (FB). A CONTRARY VIEW HAS BEEN EXPRESSED IN THE FOLLOWING CASES]
N T R ESTATE VS. COMMISSIONER OF INCOME TAX [REFERRED TO : (1986) 157 ITR 285 (AP),]
GIRIDHARILAL GHASIRAM VS. COMMISSIONER OF INCOME TAX [REFERRED TO (CAL)]
A. S. K. RATHNASWAMY NADAR FIRM VS. CIT [REFERRED TO (MAD),]
COMMISSIONER OF INCOME TAX VS. NARBHARAM POPATBHAI AND SONS [REFERRED TO : (1987) 166 ITR 534 (MP) (FB),]
DWARKADAS RAMESHWAR GOENKA VS. COMMISSIONER OF INCOME TAX [REFERRED TO : (1981) 127 ITR 397 (MAD),]
COMMISSIONER OF INCOME TAX VS. COCHIN COMPANY PRIVATE LIMITED [REFERRED TO : (1975) 101 ITR 348 (KAR),]
COMMISSIONER OF INCOME TAX VS. PANNALAL HIRALAL AND CO [REFERRED TO : (1984) 146 ITR 549 (BOM),]
CHANDMUL RAJGARHIA VS. COMMISSIONER OF INCOME TAX [REFERRED TO : (1987) 164 ITR 486 (PATNA),]
GAJANAND POONAM CHAND VS. COMMISSIONER OF INCOME TAX [REFERRED TO : (1988) 174 ITR 346 (RAJ) AND]
COMMISSIONER OF INCOME TAX VS. KISHANLAL [REFERRED TO]

JUDGEMENT

(1.) IN both the cases at the instance of the assessee, the following question has been referred under s. 256(1) of the IT Act, 1961 (in short "the Act"), for adjudication by this Court : "'Whether, on the facts and in the circumstances of the case, the commission paid by the assessee firm to Sri Rasiklal P. Rathor (individual) was rightly disallowed under S. 40(b) of the IT Act, 1961 ?"

(2.) THE cases are disposed of by this common judgment. According to the Revenue, in terms of s. 40(b) of the Act, any payment of interest, salary, bonus, commission or remuneration made by the firm to any partner of the firm in case the assessee is a firm is not a permissible deduction while computing the income chargeable under the head "Profits and gains" of business or profession.

(3.) THE assessee questioned the legality of the addition. The assessee's stand was that payment was made to Sri Rasiklal P. Rathor in his individual capacity, while his HUF was the partner and, therefore, S. 40(b) had no application. A distinction was made that Rasiklal P. Rathor was a different person while representing his HUF firm and while receiving commission as an individual.

Click here to view full judgment.

RASIKLAL AND COMPANY Vs. COMMISSIONER OF INCOME TAX

Referred Judgements :-

JUDGEMENT

QUick Links

Get in Touch

Email

Contact Numbers

Address