There are two partners in the Partnership Firm
Does expense incurred by the Director of the company for the benefit of partnership firm is allowable expenditure in the books of the Partnership Firm.
Please suggest any Case study on the relevant issues.
Hi
Any expense incurred for the benefit of the firm is an allowable expenditure. It is not pertinent as to who incurs the expense unless and until it is incurred for the benefit of the firm.
Therefore, the expense shall be allowed even if it incurred by the Director of the Company, on behalf of the benefit of the firm.
Please refer to the case study for a similar nature of expense (depreciation expense incurred on use of partner's car for firm's purposes) passed in the case of Mysore Minerals Ltd. Vs Commissioner of Income-tax (Supreme Court of India).
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