Remuneration paid to managing director in previous year cannot be a criterion for invoking provisions of section 40A(2)section 40A(2)

Benninger India Private Ltd Vs. DCIT (ITAT Mumbai) Counsel for the assessee submitted that the managing director Shri G.N. Guruprasad does not held any equity shares in the assessee company and hence assessee is being taxed under the highest slab rate. It was also claimed that the assessee company was not liable for tax due to substantial losses year to year. According to the learned Counsel there is no scope evasion of tax and in term of CBDT Circular No. 6P dated 6th July 1968 explaining the pre-requisites invoking the provisions of section 40A(2) of the Act are missing. The relevant circu...