| Case ID |
0062696a-2fe9-4997-8967-82fb7e2d9daf |
| Body |
View case body. Login to View |
| Case Number |
D-2741 of 2016 |
| Decision Date |
|
| Hearing Date |
|
| Decision |
The Punjab and Haryana High Court upheld the Tribunal's decision regarding the disallowance of remuneration paid to J and M, determining that it was unreasonable under section 40(c) of the Income-tax Act, 1961. The Court found that the Tribunal's findings were supported by material evidence. Additionally, the Court affirmed the Tribunal's stance on the classification of expenditures for serving tea, coffee, and Coca-Cola to customers as entertainment expenses under section 37(2A). Thus, the Tribunal's orders were confirmed, establishing important precedents in the interpretation of business expenses and entertainment allowances within the realm of corporate taxation. |
| Summary |
This case revolves around the interpretation of the Income-tax Act, 1961, specifically focusing on sections 40(c) and 37(2A). The Tribunal disallowed part of the remuneration paid to individuals with substantial interests in the company, citing it as unreasonable. Furthermore, expenditures incurred for serving beverages to customers were deemed entertainment expenses, thus subject to disallowance under the Act. The High Court reinforced these decisions, affirming the Tribunal's findings and setting a significant precedent for future tax assessments. This case highlights crucial aspects of tax law, especially regarding business disallowances and entertainment expenditure classifications, making it a vital reference for tax practitioners and corporate entities navigating similar issues. |
| Court |
Punjab and Haryana High Court
|
| Entities Involved |
Commissioner of Income Tax,
Amritsar Transport Co. (P.) Ltd.
|
| Judges |
Gokal Chand Mital,
S.S. Sodhi
|
| Lawyers |
Bhagirath Dass,
Ramesh Kumar,
L.K. Sood
|
| Petitioners |
Amritsar Transport Co. (P.) Ltd.
|
| Respondents |
Commissioner of Income Tax
|
| Citations |
1989 SLD 2545,
(1989) 178 ITR 574
|
| Other Citations |
Amritsar Transport Co. (P.) Ltd. v. CIT [1986] 161 ITR 18 (Punj. & Har.)
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
40(c),
37(2A)
|