S. 40A(3) : Expenses or payments not deductible – Cash payments exceeding prescribed limits – Purchase of jewellery – failure to demonstrate a situation which compelled to make payment in cash- Disallowance is held to be justified.

S. 40A(2) : Expenses or payments not deductible–Excessive or unreasonable–Salaries to directors- Preceding year was accepted by revenue–No extraordinary increase in salary-Disallowance is held to be not justified.

S. 40(a)(i) : Amounts not deductible-Deduction at source-Non-resident–Payments made to foreign law firms as consultancy fee which did not have any fixed base in India-Not taxable in India-Not liable to deduct tax at source.[S. 9(1)(i), 195]

S. 37(1) : Business expenditure–Non-compete fee paid by assessee to founder of transferor company constituted business expenditure.

S. 37(1) : Business expenditure-Employee Stock option Plan (ESOP)-Expenditure incurred on allotment of shares under Employee Stock option Plan (ESOP) is held to be allowable as business expenditure.

S. 37(1) : Business expenditure–Year of deduction-Slum development expenditure-Contingent upon authority giving vacant possession of plot-Authority was unable to hand over vacant possession of land-Disallowance of expenditure is held to be justified. [S. 145]

S. 36(1)(iii) : Interest on borrowed capital-Investment in share capital of sister concern, with a view to earn dividend income-Expenditure incurred is held to be allowable as deduction .

S. 28(i) : Business loss–Revaluation of obsolete inventories- Valuation was supported by technical experts–Allowable as business loss. [S. 145]

S. 24 : Income from house property-Deductions-Business income from renting out its property-Depreciation was allowed–Deduction u/s 24 is not permissible. [S. 24, 32]

S. 23 : Income from house property-Annual value–Standard rent -illegal tenant – Deposit of certain compensation on monthly basis in Court, could not form basis to make addition to assessee’s rental income in respect of other tenants who are protected under Rent control Act. [S. 22, Delhi Rent Control Act.]