Bonus to director for services rendered when he was not a shareholder allowable

DCIT Vs M/s. Mount Kellett Capital Management India Pvt. Ltd. (ITAT Mumbai) Conclusion: Since the director was not a shareholder when bonus was paid to him and also the bonus was not paid out of the earlier years’ accumulated profits, therefore, deduction of bonus paid to director was allowable under 36(1)(ii). Held: AO during the course of assessment proceedings noticed that assessee-company had made payment of bonus apart from salary to the Executive Chairman and Director of the company, Shri S. It claimed deduction under section 36(1)(ii) for the same. According to the AO, during the year...