https://www.taxtmi.com/caselaws?id=204620 Expenditure incurred to discharge a corporate guarantee given for a subsidiary can qualify as a business deduction where it is commercially expedient and incurred to protect the assessee's business interests. Here, the guarantees were issued in the course of business, the subsidiary supplied materials essential to the assessee's operations, and the memorandum authorised such support. The payment was held allowable as business expenditure or business loss, and the absence of direct income generation did not make it non-deductible. The accounting treatment in the books was not determinative of tax character, so the disallowance was deleted. en-us Fri, 21 Aug 2009 00:00:00 +0530 Thu, 26 Mar 2026 17:02:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=204620 Expenditure incurred to discharge a corporate guarantee given for a subsidiary can qualify as a business deduction where it is commercially expedient and incurred to protect the assessee's business interests. Here, the guarantees were issued in the course of business, the subsidiary supplied materials essential to the assessee's operations, and the memorandum authorised such support. The payment was held allowable as business expenditure or business loss, and the absence of direct income generation did not make it non-deductible. The accounting treatment in the books was not determinative of tax character, so the disallowance was deleted. Case-Laws Income Tax Fri, 21 Aug 2009 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=204620