https://www.taxtmi.com/caselaws?id=276329 Payment to managing agents on termination of a managing agency agreement is deductible only if it is shown to be revenue expenditure laid out wholly and exclusively for the business. On the facts described, the compensation and arbitration costs were treated as not meeting that test because the agents had rendered no service, part of the payment was attributable to promotion of the company, the dispute did not affect business operations, and the outlay appeared to be an oblique device to place funds with the partners. The document states that such a payment was capital in nature and not allowable as a business deduction under section 10(2)(xv) of the Income-tax Act, 1922. en-us Tue, 27 Jul 1965 00:00:00 +0530 Tue, 06 Nov 2018 14:34:59 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=276329 Payment to managing agents on termination of a managing agency agreement is deductible only if it is shown to be revenue expenditure laid out wholly and exclusively for the business. On the facts described, the compensation and arbitration costs were treated as not meeting that test because the agents had rendered no service, part of the payment was attributable to promotion of the company, the dispute did not affect business operations, and the outlay appeared to be an oblique device to place funds with the partners. The document states that such a payment was capital in nature and not allowable as a business deduction under section 10(2)(xv) of the Income-tax Act, 1922. Case-Laws Income Tax Tue, 27 Jul 1965 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=276329