2024 (4) TMI 505 - SCH - Income Tax

Nature of expenditure - Commission paid to the Managing Director - Tribunal held that the expenditure incurred can be treated as Revenue expenditure and not as capital expenditure - as decided by HC 2022 (9) TMI 1576 - MADRAS HIGH COURT methodology adopted by the Revenue is perfectly correct for the simple reason that it is not disputed that the amount has been shown as expenditure and that the payment has been made to the Managing Director and the amount has been received by the beneficiary only for the subsequent Assessment Year, which does not mean that as long as the Appellant has not shown the payment in the Books of Accounts in respect of liability, it cannot be stated that the expenditure was incurred during 2004-2005 as such expenditure would be ratified only after Board's meeting. HELD THAT - Having heard the learned counsel for the parties, the instant Special Leave Petition is permitted to be withdrawn in view of the statement in the counter affidavit that the petitioner can avail the benefit for the Assessment Year 2005-2006. With these observations, Special Leave Petition is disposed of as withdrawn.

Summary

The Supreme Court allowed the Special Leave Petition to be withdrawn as the petitioner can avail benefits for the Assessment Year 2005-2006. The case was disposed of accordingly.