2017 (1) TMI 823 - SCH - Income Tax

Guarantee commission - allowable business expenditure u/s 37 - Held that - The Special Leave Petitions are dismissed. HC order 2011 (10) TMI 443 - KARNATAKA HIGH COURT confirmed. Guarantee commission expenditure incurred is not for the purpose of earning profits of the business. Merely because the banks insisted on such guarantee and the Managing Director agreed to stand as a guarantor on payment of such commission, the commission is actually paid. That would not constitute a lawful expenditure so as to claim deduction under Section 37 of the Act. - Decided against the assessee