Hi friends,
I have a query and would require a clarification on Clause 16(a) i.e. Any sum paid to an employee as commission for services rendered, where such sums was otherwise payable to him as profit's or dividend.
I have come across a payment made by a private company to it's director in accordance with the provisions of Section 198 read with section 300 of the companies Act, 1956 i.e. 1% of the net profits of the company.
My question is whether this payment made by the company to it's director would attract the provisions of Section 36(1)(ii) of the Income Tax Act, 1961 and thereby require adequate disclosure under Clause 16(a) ?
Regards
Hrishikesh D Khatri
CAclubindia
