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2012 (9) TMI 842 - HC - Income TaxDeduction paid as upfront fee and bank charges - disallowance u/s 40 (a) (ii) - ITAT allowed the claim - Held that:- As per section 35AB that deduction is permissible in respect of any lump sum consideration for acquiring any know-how for use for the purposes of the assessee’s business. “Consideration” in section 35AB is to be understood in the sense in which it has been used in the Indian Contract Act. Therefore the word “consideration” would include the entire obligation of the assessee, without which the assessee would not be able to acquire the know-how. Having no reason to disagree with, and the language of Section-40 (a) (ii) - which in our opinion is expansive enough to cover payments of the kind as the Court has now to deal with – we feel that no substantial question of law arises for consideration - in favour of assessee.
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