https://www.taxtmi.com/caselaws?id=7759 Litigation expenditure incurred in defending a partner in a criminal prosecution was not deductible as business expenditure because it was not laid out wholly and exclusively for the firm's business. The controlling test was the nature and purpose of the legal proceeding, not the fact that the prosecution ended in acquittal. As the prosecution concerned an alleged personal statutory contravention and the partner was one of the proprietors, the defence costs were directed to protecting him from penal consequences rather than advancing the assessee-firm's business. The claimed amount was therefore not an allowable deduction under section 10(2)(xv) of the Indian Income-tax Act, 1922. en-us Mon, 02 Mar 1970 00:00:00 +0530 Wed, 18 Mar 2009 18:10:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=7759 Litigation expenditure incurred in defending a partner in a criminal prosecution was not deductible as business expenditure because it was not laid out wholly and exclusively for the firm's business. The controlling test was the nature and purpose of the legal proceeding, not the fact that the prosecution ended in acquittal. As the prosecution concerned an alleged personal statutory contravention and the partner was one of the proprietors, the defence costs were directed to protecting him from penal consequences rather than advancing the assessee-firm's business. The claimed amount was therefore not an allowable deduction under section 10(2)(xv) of the Indian Income-tax Act, 1922. Case-Laws Income Tax Mon, 02 Mar 1970 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=7759