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2006 (2) TMI 125 - HC - Income TaxSister concerns - Expenses - allowability u/s 37 - In deciding whether a payment of money is deductible expenditure, one has to take into consideration the questions of commercial expediency and the principles of ordinary commercial trading and prudence - Tribunal was right in holding that the expenses as claimed by the assessee constituted its genuine business expenses and that the same were allowable u/s 37(1) - Whether, Tribunal was right in holding that the interest shown as payable to M/s. McDowell and Company was actually allowable?" - said interest was charged for the amounts which were legally due to McDowell which were not actually paid. Once the aforesaid amount was held to be genuine business expense u/s 37(1) for non-payment of the said payment within the stipulated time, the assessee is bound to pay the said amount. Therefore, this expenditure incurred towards payment of interest is also a genuine business expenditure deductible u/s 37(1)
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