COMMISSIONER OF INCOME-TAX, WEST BENGAL vs INDIAN MOLASSES (P) LTD.

The Supreme Court held that amounts set apart by a company for a pension scheme became expenditure only upon the death of the managing director, thus qualifying as permissible expenditure under Section 10(2)(xv) of the Income-tax Act, 1922. The Court clarified that for an expenditure to be allowed, it must be established that it is not capital expenditure, is wholly and exclusively for business purposes, and authorized under Section 10(4A). The High Court's refusal to allow the Department to raise a plea regarding the nature of the expenditure was deemed incorrect, emphasizing the broad interpretation of 'question of law' under Section 66(1).