K. Ravindranathan Nair vs Commissioner Of Income Tax, Ernakulam

The Supreme Court addressed the issue of whether the assessee was entitled to a deduction of Rs. 4,18,107 under Section 37 of the Income Tax Act, 1961, for payments made to workers following a lock-out. The Court held that the payment was not for the closure of business but rather part of a single business operation across multiple units, thus affirming the Tribunal's decision. The High Court's negative answer to the question posed was overturned, allowing the deduction claim.