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TMI Blog2013 (7) TMI 387X X X X Extracts X X X X X X X X Extracts X X X X ..... business or profession - the sum and substance of the circular is also the same - paragraph 4 of the circular itself clarifies that the value of the freebies enjoyed by the medical practitioner is also taxable as business income or income from other sources- if the assessee satisfies the assessing authority that the expenditure is not in violation of the regulations framed by the Medical Council then it may legitimately claim a deduction, but it is for the assessee to satisfy the Assessing Officer that the expense is not in violation of the Medical Council Regulations referred to above – appeal decided against assesse. - CWP No. 10793 of 2012 - - - Dated:- 26-12-2012 - Deepak Gupta and Kuldip Singh, JJ. For the Petitioner: Mr. Vish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ouncil (Professional Conduct, Etiquette and Ethics) Regulations, 2002, shall be inadmissible under section 37(1) of the Income-tax Act being an expense prohibited by the law. This disallowance shall be made in the hands of such pharmaceutical or allied health sector industries or other assessee which has provided aforesaid freebees and claimed it as a deductible expense in its accounts against income. 4. It is also clarified that the sum equivalent to value of freebees enjoyed by the aforesaid medical practitioner or professional associations is also taxable as business income or income from other sources, as the case may be, depending on the facts of each case. The Assessing Officers of such medical practitioner or professional associati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny purpose which is an offence or which is prohibited by law shall not be deemed to have been incurred for the purpose of business or profession and no deduction or allowance shall be made in respect of such expenditure.)" 3. Shri Vishal Mohan, advocate, on behalf of the petitioner, contends that the circular goes beyond the section itself. We are not in agreement with this submission. The Explanation to section 37(1) makes it clear that any expenditure incurred by an assessee for any purpose which is prohibited by law shall not be deemed to have been incurred for the purpose of business or profession. The sum and substance of the circular is also the same. In case the assessing authorities are not properly understanding the circular then ..... X X X X Extracts X X X X X X X X Extracts X X X X
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