https://www.taxtmi.com/caselaws?id=119675 Expenditure incurred abroad to mobilise NRI deposits for an Indian bank's operations was treated as business procurement expense, not head-office expenditure under section 44C, and was therefore allowable. Amounts refunded to the Reserve Bank of India, being a reversal of interest earlier received on excess cash reserve balances under the statutory reserve scheme, were held compensatory rather than penal. Since the payment was not for breach of law but arose from reassessment of reserve position, it remained deductible as business expenditure. The net effect was deletion of both disputed additions and acceptance of the assessee's claim on merits. en-us Fri, 19 Jan 2007 00:00:00 +0530 Thu, 12 Jul 2012 14:45:59 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=119675 Expenditure incurred abroad to mobilise NRI deposits for an Indian bank's operations was treated as business procurement expense, not head-office expenditure under section 44C, and was therefore allowable. Amounts refunded to the Reserve Bank of India, being a reversal of interest earlier received on excess cash reserve balances under the statutory reserve scheme, were held compensatory rather than penal. Since the payment was not for breach of law but arose from reassessment of reserve position, it remained deductible as business expenditure. The net effect was deletion of both disputed additions and acceptance of the assessee's claim on merits. Case-Laws Income Tax Fri, 19 Jan 2007 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=119675