Expenditure u/s 37(1) should be disallowed to the extent not in line with existing business

Asian Paints Ltd. Vs DCIT (ITAT Mumbai) Conclusion: Expenditure incurred by assessee should be disallowed to the extent that expenditure which had been incurred for evaluation of business opportunities that could not be said to be in line with the existing business or an extension of the existing business of assessee of manufacturing of paints and enamels. AO was directed to decide on the allowability of each expenditure after duly examining the engagement letter with the consultants and the scope of work. Held: Assessee was a company and was engaged in the business of manufacturing paints and...