1993 (6) TMI 31

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..... ade only one reference, really it ought to have made three separate references as identical but separate questions arose in respect of the three different years, namely, 1973-74, 1974-75 and 1975-76. As the Tribunal has failed to do so, we direct the office to treat Income-tax Reference No. 548 of 1980 as a reference arising out of the order made for the assessment year 1973-74, and Income-tax Ref .....

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..... and, therefore, an allowable deduction. The Income-tax Officer rejected the claim of the assessee on the ground that the expenditure claimed was disproportionate to the income. As the assessee was aggrieved by this disallowance, it preferred three separate appeals to the Appellate Assistant Commissioner. The Appellate Assistant Commissioner accepted the claim of the assessee and allowed the appea .....

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..... the Department was not correct. Once it is found that the expenditure was bona fide incurred and that the same related to the business activity, then it would become deductible as the same is permitted by the provisions of law. Whether business expenditure is deductible or not would depend upon the relevant provisions of law and not how the income was earned after incurring that expenditure. We, t .....

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