https://www.taxtmi.com/caselaws?id=470827 Corporate guarantee disclosed as a contingent liability cannot be disallowed under Section 37(1) where it was neither debited to the profit and loss account nor claimed as expenditure or deduction in the return. Tax-audit reporting alone does not establish an expenditure claim, particularly where the auditor clarifies that the disclosure was inadvertent and the financial statements confirm that the amount appeared only in the notes to accounts. The adjustment was therefore deleted because disallowance under Section 37(1) presupposes a claimed expenditure. en-us Tue, 17 Dec 2024 00:00:00 +0530 Mon, 10 Aug 2026 21:46:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=470827 Corporate guarantee disclosed as a contingent liability cannot be disallowed under Section 37(1) where it was neither debited to the profit and loss account nor claimed as expenditure or deduction in the return. Tax-audit reporting alone does not establish an expenditure claim, particularly where the auditor clarifies that the disclosure was inadvertent and the financial statements confirm that the amount appeared only in the notes to accounts. The adjustment was therefore deleted because disallowance under Section 37(1) presupposes a claimed expenditure. Case-Laws Income Tax Tue, 17 Dec 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=470827