LAWS(SC)-1996-3-128

COMMISSIONER OF INCOME TAX BOMBAY Vs. MAFATLAL GANGABHAI AND CO PRIVATE LIMITED

Decided On March 12, 1996
COMMISSIONER OF INCOME TAX,BOMBAY Appellant
V/S
MAFATLAL GANGABHAI AND COMPANY LIMITED Respondents

JUDGEMENT

(1.) Leave granted in the Speical Leave Petition.

(2.) The only question in this batch of appeal is whether the payments made in cash by an assessee to its employees are within the mischief of Section 40(a) (v) and Section 40-A(5). Sub-clause(v) was inserted in clause (a) of Section 40 by the Finance Act, 1986 with effect from April 1, 1969. Section 40 (a) (v) reads as follows:

(3.) Sub-clause (v) of Section 40(a) was omitted by the Finance (No.2) Act, 1971, which simultaneously introduced sub-section(5) in Section 40-A. Sub-section (5) of Section 40-A omitting unnecessary clauses, reads thus;