https://www.taxtmi.com/caselaws?id=7416 Litigation expenses are deductible from dividend income under section 12(2) of the Income-tax Act, 1922 only when they are revenue in character, actually incurred, and laid out solely for earning that income with a real nexus to its source. The provision is narrower than the general business deduction rule in section 10(2)(xv), and a remote or indirect connection is insufficient. On the stated facts, the expenses were incurred to defend the assessee's personal status as an adopted son, not to protect the investments or earn the dividends. The connection to dividend income was therefore too remote, and the expenditure was not deductible. en-us Thu, 05 Sep 1968 00:00:00 +0530 Thu, 19 Feb 2009 18:20:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=7416 Litigation expenses are deductible from dividend income under section 12(2) of the Income-tax Act, 1922 only when they are revenue in character, actually incurred, and laid out solely for earning that income with a real nexus to its source. The provision is narrower than the general business deduction rule in section 10(2)(xv), and a remote or indirect connection is insufficient. On the stated facts, the expenses were incurred to defend the assessee's personal status as an adopted son, not to protect the investments or earn the dividends. The connection to dividend income was therefore too remote, and the expenditure was not deductible. Case-Laws Income Tax Thu, 05 Sep 1968 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=7416