Prior period expenditure was allowed to be set off against prior period income

PCIT Vs Dishman Pharmaceuticals And Chemicals Ltd (Gujarat High Court) Conclusion: Once the prior period income was held to be taxable, the prior period expenditure also should be allowed to be set off and assessee was not obliged in law to indicate any direct or indirect nexus between the prior period income and prior period expenditure. Held: AO found that assessee credited net period income i.e. prior period income minus prior period expenses. AO took the view that during the year under consideration the “prior period income” was taxable, but the “prior period expenses” were not al...