Provision of Lease Equalization Charges created in accordance with AS-19 is allowable deduction,

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Provision of Lease Equalization Charges created in accordance with AS-19 is allowable deduction.

 

Recently the Delhi ITAT has allowed  the Provision of Lease Equalization Charges, created in accordance with AS-19, is allowable deduction, since such AS is mandatory and has to be accepted for computing business income u/s 145(2).

 

Even otherwise, the deduction is revenue neutral as the same would result in lower deduction in subsequent year viz-a-viz actual rent paid.

 

The copy of the order is as under:

 

 

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