https://www.taxtmi.com/caselaws?id=8267 Under section 12(2), deduction is confined to expenditure, other than capital expenditure, incurred solely for earning income from an existing source. Where a block of shares had already ceased to be held by the assessee, the related dividend source was no longer in existence, so interest on the unpaid purchase price was not deductible. On the same reasoning, legal expenditure incurred in defending litigation concerning that block of shares was too remote from the earning of income from an existing source and was also not deductible. The note therefore states the principle that the existence of the income source at the time the expense is incurred is essential to deduction. en-us Tue, 23 Mar 1971 00:00:00 +0530 Thu, 09 Apr 2009 09:20:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=8267 Under section 12(2), deduction is confined to expenditure, other than capital expenditure, incurred solely for earning income from an existing source. Where a block of shares had already ceased to be held by the assessee, the related dividend source was no longer in existence, so interest on the unpaid purchase price was not deductible. On the same reasoning, legal expenditure incurred in defending litigation concerning that block of shares was too remote from the earning of income from an existing source and was also not deductible. The note therefore states the principle that the existence of the income source at the time the expense is incurred is essential to deduction. Case-Laws Income Tax Tue, 23 Mar 1971 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=8267