New Enroll in RBI Grade B New Batch - Starts on May 21

    Question

    Which expenditure will not be allowed as a business

    expenses u/s 37 of Income Tax Act, as per the Budget 2022-23?
    A Health and Education cess Correct Answer Incorrect Answer
    B Auditor fee Correct Answer Incorrect Answer
    C Digital connectivity expenses Correct Answer Incorrect Answer
    D Transport expenses Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Health and Education cess shall not be allowed as business Expenses under Section 37 of Income tax Act. The Budget has also clarified that gifts and freebies to doctors shall not be treated as business expenditure under section 37 of the Income-tax Act. Note - Section 37 of the Income Tax Act 1961 is a residuary section for allowability of business expenditure for computing the income chargeable under the head “Profits and gains of business or profession”. Note – education cess was brought in for the first time by the Finance Act, 2004. This amendment will take effect retrospectively from 1st April, 2005 and will accordingly apply in relation to the assessment year 2005-06 and subsequent assessment years

    Practice Next