COMMISSIONER OF INCOME TAX Vs. MILK FOOD LTD.
LAWS(DLH)-2007-5-325
HIGH COURT OF DELHI
Decided on May 01,2007

COMMISSIONER OF INCOME TAX Appellant
VERSUS
Milk Food Ltd. Respondents

JUDGEMENT

- (1.) THE following question of law has been referred for our opinion under s. 256(1) of the IT Act,1961 : "Whether on the facts and in the circumstances of the case, the Tribunal was correct in law in confirming the decision of the CIT(A) that in the cases of managing director employees, remuneration paid is regulated by s. 40(c) and not by s. 40A(5) -
(2.) IN view of the decisions rendered by the Supreme Court in CIT vs. Indian Engineering and Commercial Corpn. (P) Ltd. (1993) 112 CTR (SC) 56 : (1993) 201 ITR 723 (SC) and CIT vs. Continental Construction Ltd. (1998) 145 CTR (SC) 1 : (1998) 230 ITR 485 (SC), on the remuneration received by the managing director, who is also an employee of the company, tax has to be deducted on the basis of the higher of the two ceilings under ss. 40(c) and s. 40A(5) of the IT Act,1961.
(3.) THE reference is disposed of accordingly.;


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