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Citation: 1971 PTD 326
Court: Kerala High Court
Year: 1968
Decision Date: 1968-06-17
Parties: Smt. DEVAYANIAMMA vs COMMISSIONER OF INCOME-TAX, KERALA
Case cited as 1971 PTD 326
Court Name: Kerala High Court Judge(s): M. S. Memon, P. Govindan Nair Title: Smt. DEVAYANIAMMA vs COMMISSIONER OF INCOME-TAX, KERALA Case No.: Case No. 44 of 1967 Date of Judgment:1968-06-17 Reported As: 1971 PTD 326 Result: reference is answered JUDGMENT JUDGMENT "(1) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the disallowance of salary of Rs. 6,000 and bonus of Rs. 2,500 was justified? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the addition of Rs. 18,685 on the ground of purchase inflation was sustainable ?" The year of assessm ent with which we are concerned is 1962-63, the corresponding accounting period having ended on the 30th of September 1961. During that year of account one Sri P. Gopinathan Nair who is the husband of the assessee, was paid a sum of Rs. 1,250 per mensem as salary. The salary fixed by the assessee for Sri P. Gopinathan Nair for the period before October 1, 1960, was Rs. 1,000 per month. That the business of the assessee is being managed by the said Gopinathan Nair is not disputed. The business consists of dealing in cashewnuts, processing of the nuts for sale either by way of export or for internal consumption. The assessee owns 8 cashewnut factories. The turnover for the year in question was 61 lakhs of rupees. On the above facts and circumstances, the Tribunal found that the salary was in excess of what should reasonably be paid to…
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