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| The Tax Publishers2021 TaxPub(DT) 0028 (Del-Trib) INCOME TAX ACT, 1961
Section 37(1)
For allowability of legal fees/professional charges, assessee needs to show that these expenditures were wholly and exclusively incurred for the purposes of business and assessee also needs to elaborate the facts that the business of the assessee had not ceased to exist.
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Business expenditure - Allowability - Professional charges -
Assessee claimed expenditure on account of professional charges of which disallowance was made by AO on the ground that there was no business carried out during the year. Held: For legal fees/professional charges, assessee needs to show that whether these expenditures were wholly and exclusively incurred for the purposes of business. Assessee also needs to elaborate the facts about the business of the assessee has not ceased to exist. In view of this, matter was remanded to the file of AO with direction to assessee to prove that the same were incurred for the purposes of the business and business of the assessee had not ceased to exist.
REFERRED :
FAVOUR : Matter remanded.
A.Y. : 2018-19
INCOME TAX ACT, 1961
Section 37(1)
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