S. 40(a)(ia) : Amounts not deductible-Deduction at source-Commission to foreign parties-Short deduction of tax at source-No disallowance can be made-Model OECD Convention-Art. 7. [S. 9(1)(i)]

S. 40(a)(ia) : Amounts not deductible-Deduction at source-Non-resident-Amendment made by Finance Act (No. 2) to section 40(a)(ia) with effect from 01-04-2015, is curative in nature and thus said provision has to be applied retrospectively.

S. 37(1) : Business expenditure-Capital or revenue-Technical know-how-For upgrading engines of vehicles so as to make emission normal and also to make vehicles eco-friendly-Capital in nature-Entitle depreciation. [S. 32]

S. 37(1) : Business expenditure-Capital or revenue-Expenditure towards joint venture-Held to be capital in nature-Travel expenses-mergers and acquisitions of entities engaged in similar business-Held to be capital in nature-Consultancy fees-For developing new range of tractors and also upgradation of existing range of tractors, said expenditure was to be treated as capital in nature-Staff cost revenue nature.

S. 37(1) : Business expenditure-Provision for wages-Pending labour demand regarding incremental wages-Held to be allowable Capital or revenue-Premium on redemption of foreign currency convertible Bonds-Prorate premium payable on redemption of foreign currency convertible Bonds-Allowable as deduction-Issue of foreign currency convertible bonds-Held to be allowable as revenue expenditure-Discount given on issue of employee stock ownership plan-Allowable as business expenditure. Employee’ welfare expenses-Amount paid to an educational institution where children of assessee’s employees were taking education-Held to be allowable as revenue expenditure-Provision made towards warranty-Held to be allowable-Discount on issue of employee stock ownership plan held to be allowable-Professional fee towards acquisition-Entities which did not materialize was to be allowed as revenue expenditure-Abandoned project-Allowable as revenue expenditure.

S. 37(1) : Business expenditure-Education expenditure-Personal expenditure-Disallowance is held to be justified. [S. 132]

S. 37(1) : Business expenditure-Pharmaceutical company-Freebies to doctors-Gifts as product reminders, travel facilities of doctors, conference of doctors or similar freebies to medical practitioners or their professional associations would not be hit by Explanation 1 to section 37(1).

S. 37(1) : Business expenditure-Repairs of machinery and replacement of some of its parts-Allowable as business expenditure. [S. 32]

S. 36(1)(vii) : Bad debt-Amount written off in the books of account-Allowable as deduction. [S. 36(2)]

S. 36(1)(iii) : Interest on borrowed capital-Borrowed funds used for giving interest free loan to sister concerns-Interest disallowable., interest on funds diverted for non-business purpose was to be disallowed.