May 2019

Section 37(1) Business expenditure Allowability of (Consultancy charges) Assessee made payments to one 'S', a consultant, and claimed deduction of same as business expenditure AO, on the basis of a statement of 'S' recorded during search operations, held that 'S' had not rendered any service to assessee so as to receive such payments and disallowed expenditure Appellate Authorities allowed payments made to 'S' holding that there was sufficient evidence justifying payments made to 'S' and AO, other than relying upon statement of 'S' recorded in search, had no independent material to make disallowance Allowance of payments made to 'S' was justified

K. B. Bhujle
Advocate

7. CIT vs. Reliance Industries Ltd.; [2019] 102 taxmann.com 372 (Bom): Date of order: 30th January, 2019

 

Section 37(1) Business expenditure Allowability of (Consultancy charges) Assessee made payments to one 'S', a consultant, and claimed deduction of same as business expenditure AO, on the basis of a statement of 'S' recorded during search operations, held that 'S' had not rendered any service to assessee so as to receive such payments and disallowed expenditure Appellate Authorities allowed payments made to 'S' holding that there was sufficient evidence justifying payments made to 'S' and AO, other than relying upon statement of 'S' recorded in search, had no independent material to make disallowance Allowance of payments made to 'S' was justified

 

The assessee made payments to one 'S', a consultant, and claimed deduction of same as business expenditure. The Assessing Officer on the basis of a statement of 'S' recorded during search operations held that the said person had not rendered any service to the assessee so as to receive such payments. He accordingly disallowed the payments made to 'S'.

 

The Commissioner (Appeals) allow

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