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profits and gains from business and profession

Tax queries 1643 views 2 replies

                                             

hiii, everyone pls answer it......

state with reasins in brief whether the following expenses are permissible as deduction while computing " profits and gains from business and profession". 1. travelling expenses of rs. 20,000 incurred by a director on a tour to U.S.A in connection with negotiation of purchase of a new machinery, 2. interest paid to bank rs. 15,000 in connection with overdraft obtained for paying dividend. 3. rs. 20,000 were spent in the previous in connection with statutory income tax proceedings. 4. an expenditure of rs. 20,000 incurred towards cost of neon signs fixed on office premises for advertising the products of the assessee.

Replies (2)

Dear Simranjeet,

Actually all above cases are decided case laws -

1) Travelling expens - Allowed in the form of depreciation, being incurred in relation to a capital asset

2) Interest on OD for dividend - Allowed, being paid on account of commercial expidency

3) Fees 4 IT Proceedings - Allowed, being for business or profession

4) Neon sign board - Allowed in the form of depreciation, being a capital asset. 

Thanks Amir once again. you r really very helpful.


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