S. 41(1) : Profits chargeable to tax-Remission or cessation of trading liability-Sundry creditors-Not claimed as deduction in earlier years-Addition cannot be made.

S. 41(1) : Profits chargeable to tax-Remission or cessation of trading liability-Payment was not made due to supply of inferior quality goods-Recovery of proceedings were pending-Addition cannot be made as cessation of liability.

S. 40A(2) : Expenses or payments not deductible-Excessive or unreasonable-Consultancy and technical services from sister concern-Disallowance was restricted only t0 10 per cent of total expenses.

S. 40(a)(ii) : Amounts not deductible-Rates or tax-Education cess is not income tax-Allowable deduction. [S. 37(1)]

S. 40(a)(ia) : Amounts not deductible-Deduction at source-Freight charges-Non-resident ship owner-Not liable to deduct tax at source. [S. 172, 194C]

S. 40(a)(ia) : Amounts not deductible-Deduction at source-Rent paid-chartered accountant certifying that recipient of impugned receipt had included said receipt in their gross income and had paid tax thereon-Disallowance is held to be not valid. [S. 194I]

S. 40(a)(i) : Amounts not deductible-Deduction at source-Aircrafts-Supplementary rent in respect of cross border lease agreements-Exempt from tax-No disallowance can be made for failure to deduct tax at source-Shipping, inland waterways transport and air-transport-In respect of agreement executed after 1-4-2007 as per articles 12 and 8 of DTAA between India and Ireland, profits derived by an enterprise of contracting State from rental of aircrafts were taxable only in State of residence of lessor-DTAA-India-Ireland. [S. 9(1)(i), 10(15A), 195, Art. 8, 12]

S. 37(1) : Business expenditure-Business of real estate developer-Setting up of business-Acquired land in the year 2007-No business income-Expenses allowable as deduction-Interest earned from bank deposits-Assessable as income from other sources and not as business income. [S. 28(i), 56]

S. 37(1) : Business expenditure-Funds borrowed for setting up a thermal plant-Interest expenses till date of commissioning of power production i.e., prior to use of assets, was to be capitalized to cost of asset-Interest expenses incurred after commencement of power production-Allowable as revenue expenditure. [S.43 (1)].

S. 37(1) : Business expenditure-Expansion of existing business-Capital or revenue-New project of starting a hotel chain-Allowable as revenue expenditure.