THE HONORARY SECRETARY, SOUTH INDIA MILLOWNERS'ASSOCIATION vs THE SECRETARY, COIMBATORE DISTRICT TEXTILEWORKERS' UNION[A

The Supreme Court addressed disputes regarding bonus claims for textile mills under the Indian Income-tax Act, 1922, specifically Section 10(2)(vi). The Court held that the Industrial Tribunal erred in determining the rehabilitation period for machinery and in allowing only half of the rehabilitation claim for old machinery. It clarified that the development rebate cannot be excluded from surplus calculations and emphasized that the actual availability of depreciation as working capital must be considered. The judgment established that the Tribunal cannot arbitrarily extend the estimated life of machinery based on employer capabilities.