How many judgments cite CIT v. Walchand & Co.?

314 judgments on BharatTax cite CIT v. Walchand & Co. (65 ITR 381), spanning 2008 to 2026.

Which sections of the Income Tax Act does CIT v. Walchand & Co. come up under?

It is most often cited in judgments turning on Section 143(3), Section 14A, Section 148, Section 147, Section 40A(2)(b), Section 40A(3).

CIT v. Walchand & Co.

65 ITR 381Supreme Court of India1967#246 most cited

What is CIT v. Walchand & Co. authority for?

The necessity and reasonableness of business expenditure, including the utilization of borrowed funds, must be judged from the perspective of a businessman based on commercial expediency, and cannot be dictated by revenue authorities. The onus is on the assessee to demonstrate the business purpose and commercial expediency.

314

judgments rely on this decision, according to BharatTax’s citation analysis of 367,837 Indian tax judgments — from 2008 to 2026.

Also referred to as

CIT v. Walchand & Co. · 65 ITR 381 · Section 40A(2) · Section 40A(3) · business expediency · commercial expediency · reasonableness of expenditure · necessity of expenditure · businessman's point of view · onus on assessee · disallowance of expenditure · revenue dictating expenses

Sections most often in play

Section 143(3)Section 14A Section 148 Section 147 Section 40A(2)(b)Section 40A(3)Section 142(1)Section 142(2A)

Issues it is cited on

section 40(3)short deduction of tds interest on interest section 40a(2)(b)closely held company short deduction of tax business expediency section 40a(2)accumulated profits related party transaction commercial expediency section 194j

Judgments citing CIT v. Walchand & Co.

DCIT Cen Cir 13, Mumbai vs. Golden Wings P.Ltd, Mumbai

In the result, the appeal by the Revenue stands dismissed and the assessee’s appeal stands allowed

ITA 5972/MUM/2014[2010-11]Status: DisposedITAT Mumbai07 Dec 2017AY 2010-11

Bench: Shri Shamim Yahya, Am & Shri C. N. Prasad, Jm आयकर अपील सं./I.T.A. No. 5972/Mum/2014 ("नधा"रण वष" / Assessment Year: 2010-11) Dy. Cit, Cent. Cir.-13, M/S. Golden Wings Pvt. Ltd. बनाम/ Room No. 1103, 11Th Floor, Malkani Chambers, Old Cgo Annexe Bldg., Ground Floor, Nehru Road, Vs. Mumbai-400 020 Vile Parle (E), Mumbai-410 099 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaccg 7210 K (Revenue) : (Assessee) & आयकर अपील सं./I.T.A. No. 6228/Mum/2014 ("नधा"रण वष" / Assessment Year: 2010-11) M/S. Golden Wings Pvt. Ltd. Dy. Cit, Cent. Cir.-13, बनाम/ Room No. 1103, 11Th Floor, Malkani Chambers, Ground Floor, Nehru Road, Old Cgo Annexe Bldg., Vs. Vile Parle (E), Mumbai-410 099 Mumbai-400 020 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaccg 7210 K (Assessee) (Revenue) : Revenue By : Shri T. A. Khan Assessee By : Shri Prakash G. Jhunjhunwala सुनवाई क" तार"ख / : 18.10.2017 Date Of Hearing घोषणा क" तार"ख / : 07.12.2017 Date Of Pronouncement आदेश / O R D E R Per Shamim Yahya, A. M.: These Are Cross Appeals By The Revenue & Assessee Arising Out Of The Orders Of The Ld. Commissioner Of Income Tax (Appeals) Dated 28.07.2014 & Pertain To The Assessment Year 2010-11. 2

For Appellant: Shri Prakash G. JhunjhunwalaFor Respondent: Shri T. A. Khan

Section 131Section 133ASection 37

…case has been made out that in making the payments there has been any violation of the provisions of payment of managerial remunerations as mandated in the Companies Act. As held by that Hon’ble Supreme Court in the case of Walchand and Co. (P.) Ltd. [1967] 65 ITR 381 (SC) that in applying the test of commercial expediency, for determining whether the expenditure was wholly and exclusively laid out for the purpose of the business the reasonableness of the expenditure has to be judged from the point of view of the businessman and not of the Revenue. Hence, torch bearer of the corporate governance mantle donned b…

M/S. Chennai Petroleum Corporation Ltd., Chennai vs. ACIT, Chennai

In the result, both the assessee’s and the Revenue’s appeals are partly allowed and partly allowed for statistical purposes

ITA 1858/CHNY/2011[2004-05]Status: DisposedITAT Chennai05 Dec 2017AY 2004-05

Bench: Shri Sanjay Arora & Shri George Mathanआयकर अपील सं./Ita No.1858/Mds/2011 "नधा"रण वष" / Assessment Year : 2004-05 Chennai Petroleum Corporation Ltd., Asst. Commissioner Of Income Refinery House, Manali, Vs. Tax, Chennai – 600 068 Company Circle-I(3), [Pan: Aaacm 4392C] Chennai – 600 034 (अपीलाथ" /Appellant) (""यथ"/Respondent)

For Appellant: AdvocateFor Respondent: 07.09.2017

Section 143(3)Section 2Section 28Section 36(1)(iii)

…ty, is under bounden duty to correct the errors, if any, attending the proceedings for assessment, issuing appropriate directions. (refer, inter alia, Kapurchand Shrimal v. CIT [1991] 131 ITR 451 (SC)). As explained in CIT v. Walchand and Co. (P.) Ltd. [1967] 65 ITR 381 (SC), the tribunal is to deal with and determine all the questions which arise out of the subject matter of appeal, in light of the evidence and consistently with the justice of the case. Without prejudice to the foregoing, i.e., the reason/s for which we consider the assessee’s claim as not valid for the current year, the costs incurred and, thus…

DCIT, New Delhi vs. M/S. Tractabel Engineering Pvt. Ltd., New Delhi

In the result, appeal of the assessee is allowed partly for statistical purposes whereas the appeal of the Revenue is dismissed

ITA 456/DEL/2014[2009-10]Status: DisposedITAT Delhi23 Nov 2017AY 2009-10

Bench: Sh. H.S. Sidhu & Sh. O.P. Kantassessment Year: 2009-10 Vs. Dcit, Circle-16(1), New Delhi M/S. Tractebel Engineering Pvt. Ltd., 10-A, Shivaji Marg, New Delhi Pan : Aabct1757B (Appellant) (Respondent) & Assessment Year: 2009-10 Vs. M/S. Tractebel Engineering Pvt. Dcit, Circle-16(1), New Delhi Ltd., 10-A, Shivaji Marg, New Delhi Pan : Aabct1757B (Appellant) (Respondent)

Section 92C

…rudence. It is well settled that the revenue cannot dictate to the assessee as to how he should conduct his business and it is not for them to tell the assessee as to what expenditure the assessee can incur (Eastern Investment Ltd 20 ITR 1 (SC), Walchand & Co 65 ITR 381 (SC) followed). Even Rule 10B(1)(a) does not authorise disallowance of expenditure on the ground that it was not necessary or prudent for the assessee to have incurred the same.” 8.10 In the instant case, the assessee has failed to establish with documentary evidence as to what amount any independent party would assessee. According to the learned…

M/S. Tractebel Engineering Pvt. Ltd., New Delhi vs. DCIT, New Delhi

In the result, appeal of the assessee is allowed partly for statistical purposes whereas the appeal of the Revenue is dismissed

ITA 1078/DEL/2014[2009-10]Status: DisposedITAT Delhi23 Nov 2017AY 2009-10

Section 92C

ITO, Bangalore vs. M/S Safran Engineering Services India Private Limited, Bangalore

In the result, the appeal filed by the revenue is partly allowed

ITA 451/BANG/2015[2010-11]Status: DisposedITAT Bangalore20 Nov 2017AY 2010-11

Bench: Shri Sunil Kumar Yadav & Shri Inturi Rama Raoit(Tp)A No.451/Bang/2015 (Assessment Year: 2010-11)

For Appellant: Ms.Neera Malhaotra, CIT(DR)For Respondent: Shri K.R.Vasudevan, Advocate

Section 10ASection 143(3)Section 92C

…and powers of the AO/TPO to question the necessity of incurring expenditure. The Hon’ble Delhi High Court in the case of CIT vs. EKL Appliances Ltd. (345 ITR 241), after considering the judgment of the Apex Court in the case of CIT vs. Walchand & Co. P.Ltd. (65 ITR 381)(SC), Sassoon J.David & Co. Pvt. Ltd. vs. CIT (118 ITR 261)(SC) held that the TPO cannot determine ALP at nil by holding that there was no need to incur such expenditure. While coming to this conclusion, the Hon’ble High Court has referred to the judgment of the Apex Court in the case of Eastern IT(TP)A No.451/Bang/2015 Page 15 of 23 Investments…

Horizon Infrastructure Ltd, Mumbai vs. ACIT CC 38, Mumbai

In the result, appeal of the assessee is partly allowed

ITA 356/MUM/2015[2010-11]Status: DisposedITAT Mumbai15 Nov 2017AY 2010-11

Bench: Shri G.S. Pannu & Shri Amarjit Singh: A.Y : 2010-11

For Appellant: Shri J.P. BairagraFor Respondent: Shri M.C. Omi Ningshen &

Section 143(3)Section 14ASection 36

…Supreme Court in the case of S.A. Builders Ltd., 8 M/s. Horizon Infrastructure Ltd. 288 ITR 1 (SC), the following decisions have been relied upon to support the case of the assessee:- i) Bombay Samachar Ltd., 74 ITR 723 (Bom) ii) Walchand and Co. (P) Ltd., 65 ITR 381 (SC) iii) Indian Bank, 56 ITR 77 (SC) iv) Century Flour Mills Ltd., 334 ITR 377 (Madras) v) Agarwal Global Steels Ltd., 141 ITD 76 vi) Hero Cycles (P.) Ltd., 379 ITR 347 (SC) 9. On the other hand, the ld. DR appearing for the Revenue has primarily reiterated the stand of the lower authorities, which we have already noted in the earlier paragraphs…

Gxs India Technology Centre Private Limited, Bangalore vs. DCIT, Bangalore

In the result, the appeal filed by the assessee is dismissed

ITA 1041/BANG/2016[2010-11]Status: DisposedITAT Bangalore15 Nov 2017AY 2010-11

Bench: Shri Sunil Kumar Yadav & Shri Arun Kumar Garodia

For Appellant: Shri K.R. Vasudevan, AdvocateFor Respondent: Smt. Padmameenakshi, JCIT (DR)

Section 234DSection 28Section 37(1)

…quite unreasonable. In the present case, the issue in dispute is different and therefore, this judgment is also not applicable. 12. The next judgment is judgment of Hon’ble Apex Court rendered in the case of CIT Vs. Walchand and Co. (P.) Ltd. as reported in 65 ITR 381. In this case, the issue in dispute was regarding allowability of increased remuneration of executive officers. It was disallowed by the AO on this basis that increase in remuneration or salary of officers was not reflected in increase in profits of assessee and therefore, it was not an expenditure which can be justified as laid out wholly and nec…

Gigaplex Estate P.Ltd, Mumbai vs. DCIT OSD II Cen RG 7, Mumbai

In the result, the appeals of the assessee are partly allowed

ITA 1137/MUM/2016[2006-07]Status: DisposedITAT Mumbai10 Nov 2017AY 2006-07

Bench: Shri C.N. Prasad, Jm & Shri Rajesh Kumar, Am

For Appellant: Shri Arvind SondeFor Respondent: Shri Alok Joshi

Section 143(3)Section 147Section 148Section 250

…आयकर अपीऱीय अधिकरण, म ुंबई न्यायपीठ “जे” म ुंबई IN THE INCOME TAX APPELLATE TRIBUNAL “J” BENCH, MUMBAI श्री सी. एन.प्रसाद, न्याययक सदस्य एवं श्री राजेश कुमार, ऱेखा सदस्य के समक्ष BEFORE SHRI C.N. PRASAD, JM AND SHRI RAJESH KUMAR, AM ITA NO.1132, 1133/Mum/2016 And ITA No.1137/Mum/2016 (ननधधायण वषा / Assessment Year: 2007-08, 2008-09 and 2006-07) Gigaplex Estate Pvt Ltd., Dy.Commissioner of Income (Formerly known as B Raheja Tax, OSD-II, Central Range -7, Builders Pvt Ltd), Aayakar Bhavan, फनधभ/ Plot No.C-30, G Block, M K Road, Opp SIDBI Bank, Mumbai-400020 Vs. Bandra Kurla Complex, Bandra (Est), Mumbai-400051 (अऩी…

Gigaplex Estate P.Ltd, Mumbai vs. DCIT OSD II Cen RG 7, Mumbai

In the result, the appeals of the assessee are partly allowed

ITA 1133/MUM/2016[2008-09]Status: DisposedITAT Mumbai10 Nov 2017AY 2008-09

Bench: Shri C.N. Prasad, Jm & Shri Rajesh Kumar, Am

For Appellant: Shri Arvind SondeFor Respondent: Shri Alok Joshi

Section 143(3)Section 147Section 148Section 250

Gigaplex Estate P.Ltd, Mumbai vs. DCIT OSD II Cen RG 7, Mumbai

In the result, the appeals of the assessee are partly allowed

ITA 1132/MUM/2016[2007-08]Status: DisposedITAT Mumbai10 Nov 2017AY 2007-08

Bench: Shri C.N. Prasad, Jm & Shri Rajesh Kumar, Am

For Appellant: Shri Arvind SondeFor Respondent: Shri Alok Joshi

Section 143(3)Section 147Section 148Section 250

ITO, New Delhi vs. M/S. Alpasso Industries Pvt. Ltd., New Delhi

In the result, appeal of the Revenue is allowed

ITA 4268/DEL/2014[2010-11]Status: DisposedITAT Delhi31 Oct 2017AY 2010-11

Bench: Sh. Amit Shukla & Sh. O.P. Kantassessment Year: 2010-11 Income Tax Officer, Ward -1(3), Vs. M/S. Alpasso Industries Pvt. 4Th New Delhi Ltd., Floor, Mahindra Towers, Bhikaji Cama Place, New Delhi Pan : Aaaca2412R (Appellant) (Respondent) Appellant By Sh. Sandip Kumar Mishra, Sr.Dr Respondent By Sh. Venkatesh Chaurasia, Adv. Date Of Hearing 12.10.2017 Date Of Pronouncement 31.10.2017 Order Per O.P. Kant, A.M.:

Section 133(6)Section 143(2)Section 143(3)

…ssman to judge whether a particular expenditure was required to be done or not as business expediency is to be decided by the businessman and not by the assessing officer. I find that the Apex Court in the case of CIT, Bombay Vs. Walchand and Co. Private Ltd. 65 ITR 381 (SC) has held that “in applying the test of commercial expediency for determining whether an expenditure was wholly and exclusively for the purposes of business, the expenditure has to be adjudged from the point of view of the 7 business and not of revenue.” Considering the facts and circumstances of the case and judicial pronouncements on the iss…

G.Narasiman, Erode vs. ITO, Coimbatore

In the result, the assessee’s appeal is disposed of on the foregoing terms

ITA 1000/CHNY/2017[2012-13]Status: DisposedITAT Chennai13 Oct 2017AY 2012-13

Bench: Shri Sanjay Arora & Shri Duvvuru Rl Reddy

For Appellant: Shri Ashish Tripathi, Jt. CITFor Respondent: 26.07.2017

Section 139(1)Section 139(4)Section 139(5)Section 142(1)Section 143(2)Section 143(3)

…(i.e., for the delay in filing the return), implying it to be a belated return, filed u/s. 139(4), again showing, if that was still necessary, indeterminate facts. We, accordingly, direct its deletion. As explained in CIT v. Walchand and Co. (P.) Ltd. [1967] 65 ITR 381 (SC), the tribunal is to deal with and determine all the questions which arise out of the subject matter of appeal, in light of the evidence and consistently with the justice of the case. We decide accordingly. 6. In the result, the assessee’s appeal is disposed of on the foregoing terms. Order pronounced on October 13, 2017 at Chennai (धु"वु" आर…

ACIT 11(1), Mumbai vs. Sanjay Navin Bhansali, Mumbai

In the result, Revenue’s appeal is dismissed

ITA 6730/MUM/2014[2010-11]Status: DisposedITAT Mumbai11 Oct 2017AY 2010-11

Bench: Shri G.S. Pannu, Hon'Ble & Shri C.N. Prasad, Hon'Ble

For Appellant: Shri Chetan KariaFor Respondent: Shri V. Janardhanan

Section 143(1)Section 143(3)

…d that the refund part of professional fee by the assessee to UTV has been taken as income by the UTV in its Books of Accounts. While holding so the Ld.CIT(A) considered the decision of the Hon'ble Supreme Court in the case of CIT v. Walchand & Co. Pvt Ltd., [65 ITR 381] and Sassoon J. David & Co., Pvt. Ltd., [1 Taxman 485] wherein it has been held that ordinarily it is for the assessee to decide whether any expenditure should be incurred in the course of his or its business and such expenditure may be incurred voluntarily and without any necessity and if it is incurred for promoting the business and to earn prof…

M/S Agra Cinema Exhibitors P Ltd, Agra vs. ITO 4(1), Agra

In the result, the appeal is allowed

ITA 43/AGR/2017[2012-13]Status: DisposedITAT Agra29 Sept 2017AY 2012-13

Bench: Shri A. D. Jain

Section 56Section 57

…IN THE INCOME TAX APPELLATE TRIBUNAL AGRA (SMC) BENCH: AGRA BEFORE SHRI A. D. JAIN, JUDICIAL MEMBER I.T.A No. 43/Agra/2017 (ASSESSMENT YEAR-2012-13) M/s Agra Cinema Exibitors, (P) Vs..ITO-4(1) Ltd., 25, Nehru Nagar, Agra (U.P.) Agra. PAN No.AABCA3732F (Assessee) (Revenue) Assessee by Shri Navin Gargh, AR. Revenue by Shri Waseem Arshad, Sr.DR. Date of Hearing 21.08.2017 Date of Pronouncement 29.09.2017 ORDER This is assessee’s appeal for Assessment Year 2012-13, against the ld. CIT(A)’s action by confirming the addition made by disallowance of total expenditure of Rs.9,463/- debited to the Profit & Loss ac…

Shyamala Pictures and Hotel Private Limited, Chennai vs. DCIT, Chennai

In the result, the assessee’s appeal is partly allowed for statistical purposes

ITA 1185/CHNY/2015[2009-10]Status: DisposedITAT Chennai27 Sept 2017AY 2009-10

Bench: Shri Sanjay Arora & Shri George Mathan

For Appellant: Shri Ashish Tripathi, Jt. CITFor Respondent: 04.07.2017

Section 143(3)Section 14ASection 14A(2)Section 28

…50, indexation would apply with reference to the year ‘2002’ as the base year. Before parting, we may, lest we be construed as having, in any manner, travelled outside the scope of this appeal, refer to the decision in CIT v. Walchand and Co. (P.) Ltd. [1967] 65 ITR 381 (SC), clarifying that the tribunal is to deal with and determine all the questions which arise out of the subject matter of appeal, in light of the evidence and consistently with the justice of the case. Reliance is also placed, inter alia, on the following decisions with regard 16 Shyamala Pictures And Hotel Pvt. Ltd. v. Dy. CIT to the nature…

M/S. C D Security Services Network Ltd., New Delhi vs. ITO, New Delhi

In the result, the appeal of the assessee is partly allowed for statistical purposes

ITA 3491/DEL/2014[2008-09]Status: DisposedITAT Delhi05 Sept 2017AY 2008-09

Bench: : Shri I.C. Sudhir & Shri L.P. Sahu

Section 143(2)Section 144Section 40Section 43B

…of the business and a host of other related circumstances. It is erroneous to think that increased remuneration can only be justified if there is corresponding increase in profits of the employer. Reliance is placed upon CIT v. Walchand & Co. Pvt Ltd. (1967) 65 ITR 381 (SC)] and J K Wollens Manufacturer v. CIT (1969) 72 ITR 612 (SC). 10. That the allegation of the department that assessee has not provided any evidence to support its claim is half hearted as it is a matter of fact which was also before the AO and ld.CIT[A) and also open to verification that the office of the appellant company was sealed by MCD (M…

DCIT, New Delhi vs. M/S. Ajay Enterprises Pvt. Ltd., New Delhi

In the result, the appeals of the assessee for A

ITA 1348/DEL/2013[2008-09]Status: DisposedITAT Delhi31 Jul 2017AY 2008-09

Bench: : Shri I.C. Sudhir & Shri L.P. Sahu

For Appellant: A.Y. 2008-09For Respondent: A.Y. 2008-09

Section 41(1)

…ents made for the services rendered are allowable, as it is the businessman's prerogative to decide the quantum of payment. Following further judgments support this view:- 1. Sasoon J. David & NCo. Pvt. Ltd. Vs. CIT 118 ITR 261 (SC). 2. CIT Vs. Walchand & Co. 65 ITR 381 (SC). 3. J. K. Woolen Mills Vs. CIT 72 ITR 612 (SC). 4. Aluminium Corporation Vs. CIT 86 ITR 11 (SC). 5. CIT Vs. Delhi Safe Deposit 133 ITR 756 (SC). 6. SA Builders Ltd. Vs. CIT 288 ITR 1 (SC). ITA Nos. 898 & 899 and 1348 & 1349/Del./2013 25 4. Further, the AO has invoked Section 40A(2) for the sales made to sister concern. Section 40A(2) does n…

Ajay Enterprises Pvt. Ltd., New Delhi vs. DCIT, New Delhi

In the result, the appeals of the assessee for A

ITA 898/DEL/2013[2008-09]Status: DisposedITAT Delhi31 Jul 2017AY 2008-09

Bench: : Shri I.C. Sudhir & Shri L.P. Sahu

For Appellant: A.Y. 2008-09For Respondent: A.Y. 2008-09

Section 41(1)

M/S. Murugappa Management Services Ltd., Chennai vs. DCIT, Chennai

In the result, the appeal of the assessee stands allowed

ITA 2992/CHNY/2016[2012-13]Status: DisposedITAT Chennai31 May 2017AY 2012-13

Bench: Shri N.R.S. Ganesan & Shri D.S. Sunder Singhआयकर अपील सं./Ita No. 2992/Mds/2016 िनधा"रण वष" / Assessment Year : 2012-13 M/S. Murugappa Management Services The Deputy Commissioner Of Ltd., V. Income Tax, C/O. M/S. Subbaraya Aiyar, Corporate Circle 4(1), Padmanabhan & Ramamani, Chennai – 600 034. Advocates, New No.75 (Old No.105), Dr.Radhakrishnan Salai, Mylapore, Chennai – 4. Pan: Aaact1164F (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से/Appellant By : Shri R. Vijayaraghavan, Advocate ""यथ" क" ओर से/Respondent By : Dr.B. Nischal, Jcit सुनवाई क" तारीख/Date Of Hearing : 24.04.2017 घोषणा क" तारीख/Date Of Pronouncement : 31.05.2017 आदेश आदेश /O R D E R आदेश आदेश Per N.R.S. Ganesan:

For Appellant: Shri R. Vijayaraghavan, AdvocateFor Respondent: Dr.B. Nischal, JCIT

…n the judgment of the Apex Court in CIT vs. Dhanrajgirji Raja Narasingirji [1973] 91 ITR 544 and also judgment of Madras High Court in CIT vs. Nagesh Cine Enterprises (1998) 150 CTR 435. The Ld. counsel also placed his reliance in CIT vs. Walchand & Co Ltd, 65 ITR 381. 4. Referring to the judgments referred by the CIT(Appeals), the LD. counsel submitted that they did not apply to the facts of the case. 5. Referring to page A8 of the paper book, the Ld. counsel for the assessee submitted that Shri M.V. Murugappan was a qualified Civil Engineer and he was the Managing Director from 1958 to 1978 in CECL. He was a…

Second Leasing Pvt. Ltd., New Delhi vs. DCIT, New Delhi

In the result, the Appeal filed by the Assessee stands allowed

ITA 2412/DEL/2013[2009-10]Status: DisposedITAT Delhi19 May 2017AY 2009-10

Bench: Shri H.S. Sidhu & Shri Prashant Maharishiay. 2009-10 M/S Second Leasing Pvt. Ltd., Dcit, Circle-8(1), Flat No. N, Sagar Apartment, Vs. New Delhi 6, Tilak Marg, New Delhi – 11 001 (Pan: Aabcs6609R) (Appellant) (Respondent)

For Appellant: Sh. Ved Jain, Adv. & Ms. RanoFor Respondent: Sh. N.K. Bansal, Sr. DR

Section 142(1)Section 142(3)Section 143(1)Section 143(2)Section 143(3)Section 40A(2)Section 40A(2)(b)

…further note that the view adopted by the AO that, assessee company given the bonus to a single Director, cannot be a ground for disallowing the claim because in the case of Commissioner Of Income-Tax, Bombay Versus Walchand And Company Pvt. Limited [1967] 65 ITR 381 (SC) the Hon'ble Supreme Court accorded the view taken by Hon'ble High Court of Bombay as under:- "The High Court on a careful consideration has pointed out that the work of the assessee has increased considerably and has become more strenuous by reason of the prosperity of the managed companies and it would be reasonable and natural to infer t…