This appeal is by assessee relating to its income-tax assessment for year 1981-82. [Part of para No. 1 and para No. 2 omitted from reproduction for not being relevant to main controversy.] Coming to objection concerning incentive wages, it is seen that ITO has disallowed assessee s claim on ground that it partakes character of bonus. copy of agreement dt. 30th Sept., 1981 was furnished in this connection, which shown that workmen of mills held themselves responsible for increasing production of mills and improving industrial relations by their attendance and good discipline and they have also assured to continue same in future also and it is in order to recognise this that management agreed to pay incentive amount of Rs. 8378 to all workmen for year ended 31st Dec. 1980. It is calculated at 2 per cent of earnings of workmen for year 1980. Thus, it will be apparent that amount paid is not based on profits of company and is purely calculated with reference to earnings as incentive for their agreeing to produce more and keeping good industrial relations, etc. amount is clearly not bonus and ITO is wrong in holding that it is so. It is therefore obvious that amount is eligible for deduction as it is incurred on commercial expediency for interests of business. deduction is allowed. In result, appeal is treated as allowed. *** SHRI LAXMI SPINNERS PVT. LTD. v. INCOME TAX OFFICER