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2008 (1) TMI 567 - HC - Income TaxBusiness Expenditure- The assessee maintained accounts on both receipt and mercantile basis. The Tribunal upheld the order of commissioner (Appeals) and affirmed the deletion of additions made by the Assessing Officer (a) in respect of lease rent on the ground that the assessee followed the mercantile system of accounting, and (b) in respect of insurance charges on the plea that actual payment was made by the assessee whereas it was to be borne by the lessee as per the lease agreement. Held that- the real income was to be considered with reference to the commercial and business realities of the situation and not merely with reference to entries made in the books of account. The finding of fact was to the effect that the assessee did not earn the income and the conclusion of Tribunal was right. (ii) since the assessee claimed that the premium was paid by it the liability to pay tax could not be fastened upon on the assessee.
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