https://www.taxtmi.com/caselaws?id=38756 Payments made under commercial arrangements to meet contemplated shortfalls were held deductible as business expenditure because they were not statutory penalties for breach of law but business-incidental liabilities. Compensation paid to the Textile Commissioner for non-production of prescribed coarse cloth was allowable, as was payment for shortfall in export obligations under the import permit and bond for automatic looms, since the obligations arose from contractual or control-order arrangements connected with trade. Bank guarantee charges for securing the shortfall under the sanforized-mark arrangement were also deductible because they were incurred wholly to obtain and retain a necessary business facility. en-us Tue, 30 Mar 1976 00:00:00 +0530 Thu, 08 Apr 2010 17:41:47 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=38756 Payments made under commercial arrangements to meet contemplated shortfalls were held deductible as business expenditure because they were not statutory penalties for breach of law but business-incidental liabilities. Compensation paid to the Textile Commissioner for non-production of prescribed coarse cloth was allowable, as was payment for shortfall in export obligations under the import permit and bond for automatic looms, since the obligations arose from contractual or control-order arrangements connected with trade. Bank guarantee charges for securing the shortfall under the sanforized-mark arrangement were also deductible because they were incurred wholly to obtain and retain a necessary business facility. Case-Laws Income Tax Tue, 30 Mar 1976 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=38756