Amount paid for cancellation of agreement without contractual obligation is rightly disallowed u/s. 48

Gulf Oil Corporation Ltd Vs ACIT (Telangana High Court) Telangana High Court held that amount paid towards cancellation of agreement is liable to be disallowed under section 48(i) of the Income Tax Act since the no condition was stipulated in original Memorandum of Understanding hence in absence of contractual obligation the disallowance of said amount is justified. Facts- The appellant/assessee is a Company engaged in the manufacture of detonators, industrial explosives &, its accessories, and also engaged in the activity of floriculture. padding and manufacture of gypsum walls, panels a...