LIC Premium Allowed as Deduction Since Liability Was Not Contingent: Madras HC

Brahmayya Vs DCIT (Madras High Court) The Madras High Court examined whether LIC premium payments made by the assessee to ապահով a monthly annuity of ₹15,000 for employees (including partners) upon retirement constituted an allowable business deduction or a contingent liability. The Tribunal had disallowed the deduction, treating the payments as unrelated to services and linked to goodwill. However, the Court held that the premium payments were made to fulfill an existing contractual obligation and not a contingent liability. It observed that failure to pay premiums would defeat the as...