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2018 (12) TMI 1144 - AT - Income TaxDisallowance u/s 37(1) treating the earnest money forfeited by Maruti Suzuki India Pvt. Ltd as capital expenditure - whether the alleged amount is a capital expenditure or revenue expenditure? - Held that:- the alleged earnest money was paid by the assessee to Maruti Suzuki India Ltd in its capacity as a person carrying on business and the contract for taking an agency of vehicle manufactured by Maruti Suzuki India Ltd was a business contract entered into with a view to earn profit and it was not made or secure any capital asset or a advantage endeavour in nature. As such the alleged amount though is not covered by the provisions of Section 36(1)(viia) of the Act but certainly it will be allowable u/s 37(1) of the Act - Decided in favour of assessee.
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