https://www.taxtmi.com/caselaws?id=276059 Compensation paid on bona fide premature termination of a managing agency agreement was treated as business expenditure deductible under section 10(2)(xv) of the Indian Income-tax Act. The arrangement was found to be a commercial transaction entered into to enable the company to take over management through its board and to end a recurring managing agency commission liability. As there was no material showing a device for distribution of profits, gratuity, or any improper purpose, and the payment was supported by internal approval and shareholder sanction, the expenditure satisfied the test of commercial expediency and was allowable as incurred wholly and exclusively for business. en-us Wed, 11 Jul 1962 00:00:00 +0530 Fri, 26 Oct 2018 12:57:36 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=276059 Compensation paid on bona fide premature termination of a managing agency agreement was treated as business expenditure deductible under section 10(2)(xv) of the Indian Income-tax Act. The arrangement was found to be a commercial transaction entered into to enable the company to take over management through its board and to end a recurring managing agency commission liability. As there was no material showing a device for distribution of profits, gratuity, or any improper purpose, and the payment was supported by internal approval and shareholder sanction, the expenditure satisfied the test of commercial expediency and was allowable as incurred wholly and exclusively for business. Case-Laws Income Tax Wed, 11 Jul 1962 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=276059