https://www.taxtmi.com/caselaws?id=786228 Whether compensation paid for exchange rate fluctuations qualifies as an allowable business expenditure under the Income Tax Act was contested. The AO disallowed the deduction for lack of contractual provision and questioned the year of claim, while CIT(A) allowed it applying the commercial expediency test; ITAT reversed CIT(A) on contract interpretation. The High Court found a contractual clause supporting compensation, noted genuineness of payment was not disputed, and restored the allowance, deciding in favour of the taxpayer. en-us Mon, 02 Feb 2026 00:00:00 +0530 Mon, 09 Feb 2026 09:19:27 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=786228 Whether compensation paid for exchange rate fluctuations qualifies as an allowable business expenditure under the Income Tax Act was contested. The AO disallowed the deduction for lack of contractual provision and questioned the year of claim, while CIT(A) allowed it applying the commercial expediency test; ITAT reversed CIT(A) on contract interpretation. The High Court found a contractual clause supporting compensation, noted genuineness of payment was not disputed, and restored the allowance, deciding in favour of the taxpayer. Case-Laws Income Tax Mon, 02 Feb 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=786228