Page 2 - Brief Case

The Supreme Court has ruled deduction on account of payment of bonus to the employees of a company is allowable while computing the business income. Though this position is clear in Section 36 of the Income Tax Act, another section mandates that certain deductions would be allowed only on "actual payment". In this case, Shasun Chemicals and Drugs versus CIT, there was labour unrest during the assessment years over bonus and the employees did not accept it for some time. Therefore, the company made the payment to the trust to comply with the requirement of Section 43B, which makes it clear that deduction in respect of bonus would be allowed only on actual payment. The assessing officer took the view that as the payment was not made by the company to the employees directly in cash, it was not allowable. This became a point of dispute and the Income Tax Appellate Tribunal ruled in favour of the company. However, the Madras High Court found justification in the stand taken by the assessing

Updated On : 23 Oct 2016 | 10:48 PM IST

Secrecy in anti-dumping complaints

The Supreme Court has laid down guidelines on the claim of confidentiality in anti-dumping investigations under the Customs Tariff Act and Rules. When a party files a complaint before the Designated Authority (DA) under the Act, it might provide confidential information, which if disclosed to interested parties might harm the complainant or others. Investigation is required to find out whether dumping has taken place and if yes, its margin to fix countervailing duty. The degree of confidentiality in dealing with such complaints was a matter of discord and some judgments appeared to be contradictory. Therefore, the issue was referred to a larger bench in the batch of cases led by Union of India vs M/s Meghmani Organics. Interpreting Rule 7, which deals with confidentiality, the judgment said "while taking precautions not to disclose sensitive confidential information, the DA can, by adopting a sensible approach indicate reasons on major issues so that parties may in general terms have t

Updated On : 16 Oct 2016 | 9:32 PM IST

Delay in award no ground to quash it

The high court said a party can raise the issue only if it suffered prejudice by the delay

Updated On : 09 Oct 2016 | 10:52 PM IST

Debt policy can't be changed mid-way

On appeal, the Supreme Court overruled the high court and stated that when the firms have acted on the policy, it could not be departed from

Updated On : 02 Oct 2016 | 10:05 PM IST

Rail line experience not valid for metro rail

Qualifications required to bid for an inter-city rail project and a metro rail one are different as there are qualitative differences in the construction, the Supreme Court has ruled while setting aside the judgment of the Bombay High Court in the appeal, Afcons Infrastructure Ltd vs Nagpur Metro Rail Corporation. A joint venture between Guangdong Yuantian Engineering Company of China and Tata Projects Ltd bid for the project claiming that the Chinese firm had executed the Pearl River Delta inter-city high-speed railway project in that country. However, the metro corporation rejected the bid as building an inter-city railway for trains, which are faster, with less frequency, was different from intra-city metro. An inter-city high speed railway project did not meet the requirements of metro civil construction work. The JV moved the high court against that decision. It found that the difference was "illusory" and the decision was arbitrary. Afcons, one of the bidders, appealed to the S

Updated On : 25 Sep 2016 | 9:33 PM IST

When arbitration moves at a snail's pace

Though arbitration is considered to be a speedy remedy, some cases might take decades to conclude. In the latest arbitration judgment delivered by the Supreme Court, the tender for a hydel scheme was floated in 1979 and the project was to be completed in 1982. Disputes arose between the contracting firm, Harish Chandra & Co and the Uttar Pradesh government over payment. Two sets of claims were referred to arbitration under the 1940 arbitration law, which has now been repealed. The award was passed in 1995 in favour of the contractor, which was challenged by the government before the civil judge. He confirmed the award in 1996. The government appealed to the high court in 2001. The judgment came in 2007. The contractor appealed to the Supreme Court the same year. It took nine years for the court to deliver its judgment, which upheld the contractor's claims. However, an appeal in another part of the arbitration proceedings is still pending. The present judgment was critical of the hi

Updated On : 18 Sep 2016 | 9:36 PM IST