https://www.taxtmi.com/caselaws?id=277389 Whether a deduction from a managing agent's commission used to satisfy the agent's decrees is revenue or capital was resolved by applying the contractual obligation test and the business purpose test: the proviso requiring expenditure to be incurred wholly, necessarily and exclusively under a contract is unmet where no contractual duty exists, while the deduction test permits expenditures not capital or personal and laid out wholly and exclusively for business. Payments made to avert publicity, exposure and loss of managing agency that do not create an enduring advantage are revenue in nature and thus deductible; outcome: the sum is not taxable in the company's hands. en-us Fri, 09 Sep 1949 00:00:00 +0530 Mon, 03 Dec 2018 12:13:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=277389 Whether a deduction from a managing agent's commission used to satisfy the agent's decrees is revenue or capital was resolved by applying the contractual obligation test and the business purpose test: the proviso requiring expenditure to be incurred wholly, necessarily and exclusively under a contract is unmet where no contractual duty exists, while the deduction test permits expenditures not capital or personal and laid out wholly and exclusively for business. Payments made to avert publicity, exposure and loss of managing agency that do not create an enduring advantage are revenue in nature and thus deductible; outcome: the sum is not taxable in the company's hands. Case-Laws Income Tax Fri, 09 Sep 1949 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=277389