𝗧𝗲𝗹𝗮𝗻𝗴𝗮𝗻𝗮 𝗛𝗶𝗴𝗵 𝗖𝗼𝘂𝗿𝘁 𝗥𝘂𝗹𝗶𝗻𝗴 𝗼𝗻 𝗗𝗲𝗱𝘂𝗰𝘁𝗶𝗼𝗻 𝗼𝗳 𝗘𝘅𝗽𝗲𝗻𝗱𝗶𝘁𝘂𝗿𝗲𝘀 📢 Justice P. Sam Koshy and Justice Laxmi Narayana Alishetty stated,

For an expenditure to qualify for deduction under Section 37, it must be incurred for the business carried on by the assessee and must be spent wholly and exclusively for its own business.

🔍 𝗙𝗮𝗰𝘁𝘀: 𝗖𝗼𝗺𝗽𝗮𝗻𝘆: M/s Pipelic Energy Software India Pvt. Ltd. 𝗜𝘀𝘀𝘂𝗲: Deducting expenses for overseeing the holding company's project. 𝗣𝗿𝗼𝗰𝗲𝗲𝗱𝗶𝗻𝗴𝘀: Expenses disallowed by AO, initially allowed by CIT(A), but reversed by Tribunal.

⚖️ 𝗝𝘂𝗱𝗴𝗲𝗺𝗲𝗻𝘁: The High Court upheld the Tribunal's ruling: such expenses are not deductible under Section 37.

𝗖𝗮𝘀𝗲 𝗜𝗻𝗳𝗼: 𝗧𝗶𝘁𝗹𝗲: M/s Pipelic Energy Software India Pvt. Ltd. vs. The Deputy Commissioner of Income Tax 𝗖𝗮𝘀𝗲 𝗡𝗼: ITA No. 561 Of 2006

📜 This emphasizes distinguishing operational expenses from those for a holding company. #TelanganaHighCourt #IncomeTax #arr4nirc