CIT, MADRAS versus BRAKES INDIA LTD.

CIT, MADRAS versus BRAKES INDIA LTD.

Remuneration to the foreign technical director exempt under section 10(6)(vii) is considered 'nil' income for the purpose of section 40(c)(iii), thereby attracting the second proviso, which excludes the main provision from application to such salary income.

Parties
Appellant: C.I.T., Madras; Respondent: Brakes India Ltd.
Jurisdiction
India
Judgment Date
06 April 1993
Procedural Posture
Civil Appeal / Supreme Court Judgment on Appeal From High Court
Outcome
Appeal dismissed.
Legal Topics
Income Tax, Exemption of Salary, Interpretation of Section 10(6)(vii) and 40(c)(iii), Deduction of Perquisites
Taxation Income Tax Exemption of Salary Interpretation of Section 10(6)(vii) and 40(c)(iii) Deduction of Perquisites

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Parties

C.I.T., Madras

Appellant

Brakes India Ltd.

Respondent

Procedural Posture

Civil Appeal / Supreme Court Judgment on Appeal From High Court

Legal Issues

  1. 1 Whether salary paid to a foreign technical director, exempt under section 10(6)(vii) of the Income-tax Act, 1961, can be included for the purposes of section 40(c)(iii) disallowance.

Ratio Decidendi

Remuneration to the foreign technical director exempt under section 10(6)(vii) is considered 'nil' income for the purpose of section 40(c)(iii), thereby attracting the second proviso, which excludes the main provision from application to such salary income.

Court Disposition

Appeal dismissed.

Orders

  • No costs.