Deduction U/s 36(1)(ii) allowable on bonus paid to directors

Candor Business Solutions P. Ltd. Vs ITO (ITAT Bangalore) Conclusion: Where bonus has been paid to directors for the services rendered and as part of a payment of employment, deduction of the same was to be allowed u/s. 36(1)(ii). Held: AO disallowed amount of bonus to director-shareholders of the assessee company u/s. 36(1)(iii). In the present case, bonus was paid in addition to salary as a reward for services rendered by the two directors to assessee company and it was in no way related to their shareholdings in assessee-company. Further, it also could not be considered as a dividend paymen...