Saturday, October 15, 2011

Expenditure before actual receipts.

ITO Vs. Omni Globe information Technologies India (P) Ltd. [ITA No.3465/D/09, dtd. 29.04.2010]

Expenditure incurred by the assessee- company, incorporated for carrying out the business of the BPO, prior to the setting up of business, cannot be taken into account for computing the business income

Business is set up when it reaches a stage where it is in a position to procure business and not before. However, the expenditure becomes deductible from such stage, irrespective of the date of actual receipt of the business.

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