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| The Tax Publishers2019 TaxPub(DT) 3612 (Mad-HC) INCOME TAX ACT, 1961
Section 37(1)
As the direction of State Government for the payment of part amount came just before the end of the financial year but the said part payment was made in subsequent year, entire expenditure would be allowed under section 37 in the same financial year as the liability was incurred during that financial year.
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Business expenditure - Allowability - Contributions made to the Institute of Road Transport under section 35(1)(ii) -
Assessee made contributions to the Institute of Road Transport and had not claimed weighted deduction of one and half times as per section 35(1)(ii) but claimed only 100% of the actual expenditure under section 37. Revenue alleged that the contributions made by assessee indicate that scientific research was made but since part amount was paid after the completion of financial year, it could not be allowed as deduction under section 35(1)(ii). Held: Since the direction of State Government for the payment of part amount came just before the end of the financial year but the said part payment was made in subsequent year, therefore, entire expenditure would be allowed under section 37 in the same financial year as the liability was incurred during that financial year.
REFERRED :
FAVOUR : In assessee's favour
A.Y. : 1991-1992 & 1992-1993
INCOME TAX ACT, 1961
Section 145(1)
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