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TMI Blog2023 (12) TMI 348X X X X Extracts X X X X X X X X Extracts X X X X ..... as paid by the respondent/assessee to its sister concerns, namely M.M. Carpets Industries Ltd. and Trinity Global Enterprises Ltd. The fact that the expenses were incurred for prospective clients should be good enough for the respondent/assessee to claim deduction qua the same, as every expense does not necessarily translate into corresponding income. Since, as noticed above, the appellant/revenue has treated the amount expended by the respondent/assessee as revenue receipt in the hands of its sister concerns, in our opinion, the same transaction cannot be treated differently in the hands of payer i.e., respondent/assessee. Besides, as noted above, in AY 2010-11, the AO had allowed deduction vis- -vis amounts expended towards superv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Assessing Officer (AO) pertaining to supervisory and risk management expenses. The AO on this account had added Rs. 4,33,06,842/-. 8. The Commissioner of Income Tax Appeals [in short, CIT(A)] deleted the addition; a view which has been sustained by the Tribunal. 9. Mr Puneet Rai, learned senior standing counsel, who appears on behalf of appellant/revenue, says that the deletion of the addition concerning the amount said to have been spent by the respondent/assessee towards supervisory and risk management, was flawed. 9.1 According to Mr Rai, the aforementioned expenses were not incurred by the respondent/assessee for its business purposes. 10. The record shows that the respondent/assessee is in the insurance brokerage b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal preferred by the appellant/revenue with the Tribunal was closed on account of low tax effect. 16. Having regard to the facts obtaining in the case, to our minds, the argument advanced by Mr Rai that the amounts expended by the respondent/assessee towards supervisory and risk management charges were not linked to its business, is untenable. 16.1. The submission of Mr Rai is founded on the rationale that while the said expenses were incurred for prospective clients it did not result in the respondent/assessee earning a matching income. 17. According to us, this argument is flawed. The fact that the expenses were incurred for prospective clients should be good enough for the respondent/assessee to claim deduction qua the same, as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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