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2019 (2) TMI 1472 - HC - Income TaxRedemption fine - allowablity as business expenditure u/s 37 - irregularities or illegalities committed in the process of importing the goods - HELD THAT:- AO had summoned the import licence holder M/s. Rajnikant Brothers whose representative had stated before the Assessing Officer that M.P. Gupta, the present assessee had imported almond by using the licence and that redemption fine of ₹ 75 lacs paid to the Madras Custom House was done by M.P. Gupta. All transactions were made by him and he was responsible for the fine. He stated clearly that as per the agreement, M/s. Rajnikant Brothers were only entitled to the service charges. There was ample evidence on record suggesting that the assessee had made imports through his direct involvement by using the import licence of M/s. Rajnikant Brothers and that M/s. Rajnikant Brothers merely received an agreed commission. The assessee cannot disassociate or divest himself from the irregularities or illegalities committed in the process of importing the goods. Thus, the penalty was for the infraction of law committed by the assessee. -Decision HAJI AZIZ AND ABDUL SHAKOOR BROTHERS VERSUS[1960 (11) TMI 15 - SUPREME COURT]folloed- Decided in favour of the Revenue and against the assessee.
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