https://www.taxtmi.com/caselaws?id=290762 Litigation expenditure incurred to defend a suit arising from an earlier transaction was not allowable as a deduction under Section 10(2)(ix) of the Indian Income Tax Act, 1922, because the statutory allowance was confined to expenditure incurred solely for earning profits or gains of the relevant previous year. Expenses laid out to resist a claim, avert future liability, or protect the business from possible future claims did not satisfy that test, and the amount was also treated as capital in character. The reference was answered against the assessee and in favour of the Revenue. en-us Wed, 19 Feb 1941 00:00:00 +0530 Thu, 15 Oct 2020 11:08:48 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=290762 Litigation expenditure incurred to defend a suit arising from an earlier transaction was not allowable as a deduction under Section 10(2)(ix) of the Indian Income Tax Act, 1922, because the statutory allowance was confined to expenditure incurred solely for earning profits or gains of the relevant previous year. Expenses laid out to resist a claim, avert future liability, or protect the business from possible future claims did not satisfy that test, and the amount was also treated as capital in character. The reference was answered against the assessee and in favour of the Revenue. Case-Laws Income Tax Wed, 19 Feb 1941 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=290762