No Section 40A(2) disallowance of Expense Without Proof of Excessive or Unreasonable Payment

Egberts India Private Limited Vs ITO (ITAT Chennai) In a recent decision, the Income Tax Appellate Tribunal (ITAT) Chennai addressed the contentious issue of disallowance under Section 40A(2)(b) of the Income Tax Act, pertaining to consultancy charges paid to a resident director of Egberts India Private Limited. The dispute arose from a disallowance proposed by the Assessing Officer (AO) amounting to Rs. 73.78 lakhs, concerning consultancy charges paid to Mr. S. Sridharan, a resident director of Egberts India Private Limited. The AO contended that the increase in consultancy charges from Rs. 2...