The Tax Publishers2020 TaxPub(DT) 4591 (Del-Trib)

INCOME TAX ACT, 1961

Section 37(1)

Legal and Professional expenses incurred for the purpose of establishment of branch at UK were allowable as business expenditure under section 37(1).

Business expenditure - Legal and professional expenses incurred for purpose of establishment of branch at UK - AO alleged no business nexus -

Assessee claimed deduction of 'Legal and Professional Expenses'. AO disallowed deduction on the ground of no business nexus. Held: Legal and pofessional expenses are paid to professionals for their legal and commercial advice which are necessary for carrying on business. As evident, expenses in question were incurred for the purpose of establishment of branch at UK and, therefore, expenditure solely incurred for the purpose of the business development, was allowable as such.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2004-05 & 2005-06

INCOME TAX ACT, 1961

Section 92C

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