JUGAL KISHORE BALDEO SARAI vs COMMISSIONER OF INCOME-TAX, U.P., LUCKNOW

The Supreme Court held that remuneration paid to the karta of a Hindu undivided family for managing the family business is deductible under Section 10(2)(xv) of the Income-tax Act, 1922, provided it is under a valid agreement, bona fide, and in the interest of the business. The Court found that the agreement between the brothers was not prejudicial to the minors' interests and was acquiesced by them. Thus, the remuneration was deemed a genuine expenditure for the business, allowing the appeal against the earlier rejection by the Department, Tribunal, and High Court.