S. 40(a)(ia) : Amounts not deductible-Deduction at source-Copy editing, indexing and proof reading requiring only knowledge of language and not expertise in subject matter of text-Services rendered by Non-residents not Technical Services-Not liable to deduct tax at source-No disallowances can be made. [S. 195(6)]

S. 37(i) : Business expenditure-Bogus purchases-Entire purchase and sale transactions duly recorded in regular books of account of all parties-Entire transactions routed through regular banking channels-No incriminating documents with respect to purchases and sales found in search-Purchases are genuine-Addition is held to be not justified.

S. 37(1) : Business expenditure–Method of accounting-Ad-hoc disallowances of general expenses without rejecting the books of account- No disallowances can be made.[S. 145]

S. 37(1) : Business expenditure–Commission to the HUF from whom unsecured loan was borrowed–Commission paid to HUF is an allowable expenditure.

S. 36(1)(iii) : Interest on borrowed capital-Interest-free loans to sister concerns-Interest-free funds available with assessee more than advance paid to its sister concerns-AO to decide in accordance with supreme court decision.

S. 32 : Depreciation-Unabsorbed depreciation-Set-off-Assessee admitting income from business and profession-Entitled to set off brought forward loss against such income. [S. 32(2)]

S. 28(i) : Business loss-Genuineness of transaction-Amount paid by National housing bank (NHB) to assessee bank-but credited by assessee to the account of one Shri Harshad Mehta (HM)-subsequently such transaction got burnt in the fire of securities scam-Repayment of such amount to NHB-not allowed as business loss. [S. 44C]

S. 28(i) : Business loss-Claim To Loss of stocks stored in agents’ godowns on account of insect infestation-Assessee giving specific details of purchase of wheat, copies of bills, vouchers-AO ought To have issued summons to entities from whom wheat purchased-claim not to be rejected on surmises, suspicion and conjecture-Stock loss in trading of wheat allowable.

S. 17(2) : Perquisite-Fringe Benefits-Supply of electricity to employees at concessional rates-concession to be treated as Fringe Benefit. [S. 2(33B), 15, 192]

S. 10A : Free Trade Zone–Loss in-unit situated outside the Software Technology Park (STPI) not adjusted against units within the STPI-Income enhanced–Deduction is allowable on enganced income-Expenses excluded from export turnover– Consequential exclusion from total turnover.