https://www.taxtmi.com/caselaws?id=344244 Compensation paid under an arbitration award for failure to deliver agreed built-up area was treated as deductible business expenditure because the transaction formed part of the assessee's regular real-estate business and the contractual liability arose from the agreement itself. Objections based on absence of registered ownership and the agreement being in the managing partner's name were rejected, as the dispute concerned joint development rights and the firm's accounts reflected the transaction. The liability was held to have crystallised when non-performance became evident; the later arbitration award only quantified an existing obligation. Applying mercantile accounting and prudence, the deduction was allowed in the year of crystallisation. en-us Fri, 12 May 2017 00:00:00 +0530 Tue, 13 Jun 2017 12:27:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=344244 Compensation paid under an arbitration award for failure to deliver agreed built-up area was treated as deductible business expenditure because the transaction formed part of the assessee's regular real-estate business and the contractual liability arose from the agreement itself. Objections based on absence of registered ownership and the agreement being in the managing partner's name were rejected, as the dispute concerned joint development rights and the firm's accounts reflected the transaction. The liability was held to have crystallised when non-performance became evident; the later arbitration award only quantified an existing obligation. Applying mercantile accounting and prudence, the deduction was allowed in the year of crystallisation. Case-Laws Income Tax Fri, 12 May 2017 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=344244