S. 37(1) : Business expenditure – Foreign exchange fluctuation loss- Advance of loan to Indian Permanent Establishment – loss is allowable as deduction – DTAA- India -Spain [S.9(1)(i), art .7 ]

S. 28(iv) : Business income – Value of any benefit or perquisites – Converted in to money or not –Non compete fee-Capital or revenue-Compensation of Rs 40 crores for discontinuing commodity trading business-Commodity trading was transferred entirely to its group concern without there being any impairment to business/profit making apparatus of assessee-company-Taxable as business – However when there was no principal and agent relationship between assessee and parent company, compensation received by assessee for discontinuing commodity trading was not from parent company and was not in lieu of surrender of any agency, compensation did not fall within ambit of taxation under section 28(ii)(c) [ S.28(ii)(c )

S. 36(1)(va): Any sum received from employees – Employees’ contribution to PF and ESIC – Amounts not deposited in relevant fund before due date as prescribed in Explanation to section 36(1)(va)- No deduction is allowable even though same was deposited before due date as stipulated under section 43B of the Act. [ S.43B , 139(1) ]

S. 36(1)(iii) :Interest on borrowed capital -Business expenditure -Advance to subsidiary companies out of borrowed funds who further gave said advances to SPVs of assessee who utilised for carrying on business activities of construction and development of airports – No business activities under taken – Expenditure incurred on finance charges is held to be not allowable as deduction- there is evidence of nexus of borrowing funds being invested in sister concern and assessee sources of income can only be earning dividend income, the entire interest income has to be considered for disallowance under section 14A under rule 8D2(i)/(ii) for the impugned assessment year. [ S.14A, 37(1),R.8D(1)(ii) ]

S.28(i):Business loss- Value of shares held as stock- Devalued in books to evade tax – Claim being notional loss not allowable as business loss [ S.145 ]

S. 23 : Income from house property – Annual value – When part of the house is occupied during the year and part is let out only actual rent received by the assessee has to be considered. [ S. 22 ]

S. 17 : Perquisite -Employee Stock Option Plans- Tax arises in hands of employees, on date of allotment of shares and not on date of exercise of option. [ S.15, 17(2), 192, 201(1A) ]

S. 14A : Disallowance of expenditure – Exempt income – Disallowance cannot exceed amount of exempt income and if there is no exempt income, no disallowance can be made. [ R.8D ]

S. 11 : Property held for charitable purposes – Application of income – Giving funds to various organisations which are carrying out activities of relief to poor or medical relief will constitute application of income .[ S. 2(15) 12AA,13 ]

S. 10(37) : Capital gains – Agricultural land – With in specified urban limits – Interest on compensation- Interest awarded under section 28 of Land Acquisition Act, 1894 on enhanced compensation paid for acquisition of agricultural land, would be eligible for exemption. [ S.56, Land Acquisition Act, 1894 ,S.28 ]