CIT v. Kap Scan and Diagnostic Centre (P.) Ltd.

344 ITR 476High Court2012#2000 most cited

What is CIT v. Kap Scan and Diagnostic Centre (P.) Ltd. authority for?

Payment of commission to doctors for referring patients to diagnostic centers or providing gifts, freebies, or hospitality to medical practitioners by pharmaceutical companies is against public policy and cannot be allowed as a business expenditure under Section 37(1). Demanding such benefits is unethical on the part of doctors, and paying them is equally unethical on the part of companies.

58

judgments rely on this decision, according to BharatTax’s citation analysis of 292,668 Indian tax judgments — from 2016 to 2025.

Also referred to as

CIT v. Kap Scan and Diagnostic Centre · 344 ITR 476 · 25 Taxmann.com 92 · Section 37(1) · commission to doctors · freebies to doctors · gifts to doctors · medical referrals · diagnostic centre payments · pharmaceutical company expenses · expenditure against public policy · prohibited by law

Also reported as

25 Taxmann.com 92

Sections most often in play

Section 133(6)Section 142(1)Section 143(2)Section 143(3)Section 143(3A)Section 143(3B)Section 37(1)

Issues it is cited on

freebies to doctorssection 92f(v)r&d expendituresection 35(1)bright line testprohibited by lawamp expendituresection 33weighted deductionsection 35(2ab)explanation to section 37section 92f

Judgments citing CIT v. Kap Scan and Diagnostic Centre (P.) Ltd.

DIOSMA LIFESCIENCES PRIVATE LIMITED,MUMBAI vs. INCOME TAX OFFICER WARD 4(1) THANE, THANE

In the result, the appeal of the assessee is dismissed

ITA 4271/MUM/2025[2018-19]Status: DisposedITAT Mumbai16 Sept 2025AY 2018-19

Bench: Ms. Kavitha Rajagopal & Shri Prabhash Shankardiosma Lifesciences Private V/S. Income Tax Officer, Ward – Limited बनाम 4(1), Qureshi Mansion, Shop No. 77, C-Wing, Gokhale Road, Naupada, Harmony Mall Commercial Thane West, Thane - 400 Premises, Bhagat Singh Nagar 602, Maharashtra No.1, Link Road, Goregaon(West), Mumbai - 400 104, Maharashtra स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aafcd0525R Appellant/अपीलार्थी .. Respondent/प्रतिवादी

For Appellant: Shri Vipul Shah, ARFor Respondent: Shri Aadesh Rai, Addl. CIT, (Virtually appeared)
Section 133(6)Section 143(2)Section 143(3)Section 37(1)

…ally factored into the drug, driving prices up, thus creating a perpetual publicly injurious cycle….” 9.3 While the Apex Court approved the dictum of the Punjab & Haryana High Court in Commissioner of Income-Tax v. Kap Scan and Diagnostic Centre P. Ltd.(2012) 344 ITR 476 (P&H HC) and Himachal Pradesh High Court in Confederation of Indian Pharmaceutical Industry (SSI) v. Central Board of Direct Taxes (2013) 353 ITR 388 (HP HC), it distinguished/overruled a number of earlier judgments of the High Courts, which ran contra to the dictum of Apex Laboratories (supra). In Commissioner of Income-Tax v. Kap Scan and Diagn…

PR. COMMISSIONER OFLNCOME TAX -21 vs. M/S.REMFRY&SAGAR

ITA/199/2017HC Delhi31 Jan 2025

Bench: CASES PERTAINING TO SPL.DIVISION BENCHES

Section 37

…TA 449/2022 Page 16 of 27 pertinently observed: - “34. The impugned judgment, along with the judgments of the Punjab & Haryana High Court (Kap Scan [CIT v. Kap Scan & Diagnostic Centre (P) Ltd., 2010 SCC OnLine P&H 12926 : (2012) 344 ITR 476] ) and the Himachal Pradesh High Court (Confederation [Confederation of Indian Pharmaceutical Industry (SSI) v. Central Board of Direct Taxes, 2012 SCC OnLine HP 8007 : (2013) 353 ITR 388] ) have correctly addressed the important public policy issue on the subject of allowance of benefit for supply of freebies. The impugned judgment's [Apex…

PR. COMMISSIONER OFLNCOME TAX -21 vs. M/S.REMFRY&SAGAR

ITA-199/2017HC Delhi31 Jan 2025
Section 37

…TA 449/2022 Page 16 of 27 pertinently observed: - “34. The impugned judgment, along with the judgments of the Punjab & Haryana High Court (Kap Scan [CIT v. Kap Scan & Diagnostic Centre (P) Ltd., 2010 SCC OnLine P&H 12926 : (2012) 344 ITR 476] ) and the Himachal Pradesh High Court (Confederation [Confederation of Indian Pharmaceutical Industry (SSI) v. Central Board of Direct Taxes, 2012 SCC OnLine HP 8007 : (2013) 353 ITR 388] ) have correctly addressed the important public policy issue on the subject of allowance of benefit for supply of freebies. The impugned judgment's [Apex…

D.C.I.T., CC - 2(3), KOLKATA, KOLKATA vs. EKO DIAGNOSTIC PVT. LTD., KOLKATA

In the result, appeal of the revenue is dismissed

ITA 159/KOL/2023[2013-2014]Status: DisposedITAT Kolkata17 Jan 2024AY 2013-2014

Bench: Shri Sanjay Garg, Hon’Ble & Dr. Manish Borad, Hon’Ble

For Appellant: Shri A.K. Tulsyan, A/RFor Respondent: Smt. Madhumita Das, Addl. CIT, D/R
Section 143(2)Section 2(22)(e)Section 250Section 37(1)

…paid to private doctors for referring patients for diagnosis could not be allowed as business expenditure. In support, AO has cited the decision of the Hon'ble High Court of Punjab & Haryana in the case of CIT Vs. KAP Scan & Diagnostic Centre Pvt. Ltd. (2012) 344 ITR 476 (P&H). Hence, AO has made an addition of Rs.48,56,909/-. 4.2 In the appellate proceedings, appellant has submitted that Rs.48,56,909/- have been paid to doctors called for specific consultancy for preparation of diagnostic reports or guidance to in-house doctors. Without any evidence on record, AO has whimsically alleged that the payment of Rs.48…

ASST COMM OF INCOME TAX-2(2)(1), MUMBAI vs. M/S. MEDLEY PHARMACEUTICALS LTD., MUMBAI

In the result, all the appeals of the assessee are partly allowed and all the appeals of the Revenue are dismissed

ITA 306/MUM/2023[2018-19]Status: HeardITAT Mumbai28 Jun 2023AY 2018-19
Section 14ASection 33Section 35Section 80I

…be allowed in respect of such expenditure.  Expression prohibited by law has the same contextual import as the expression forbidden by law.  MCI guidelines, though applicable to doctors, would be applicable to the Pharma Company also and relied on P&H HC in 344 ITR 476.  Demanding of gifts, travel facility, hospitality, cash or monetary grant from pharma sector was bad on the part of doctors and paying it was equally bad on part on pharma companies.  In view thereof, the AO disallowed a sum of Rs.13,45,68,910/- without giving any breakup incurred for M/s. Medley Pharmaceuticals Ltd providing gifts, travel fac…

ASST COMM OF INCOME TAX-2(2)(1), MUMBAI vs. M/S. MEDLEY PHARMACEUTICALS LTD., MUMBAI

In the result, all the appeals of the assessee are partly allowed and all the appeals of the Revenue are dismissed

ITA 305/MUM/2023[2013-14]Status: DisposedITAT Mumbai28 Jun 2023AY 2013-14
Section 14ASection 33Section 35Section 80I

…be allowed in respect of such expenditure.  Expression prohibited by law has the same contextual import as the expression forbidden by law.  MCI guidelines, though applicable to doctors, would be applicable to the Pharma Company also and relied on P&H HC in 344 ITR 476.  Demanding of gifts, travel facility, hospitality, cash or monetary grant from pharma sector was bad on the part of doctors and paying it was equally bad on part on pharma companies.  In view thereof, the AO disallowed a sum of Rs.13,45,68,910/- without giving any breakup incurred for M/s. Medley Pharmaceuticals Ltd providing gifts, travel fac…

M/S. MEDLEY PHARMACEUTICALS LTD.,MUMBAI vs. DY COMM OF INCOME TAX-10(2)(2), MUMBAI

In the result, all the appeals of the assessee are partly allowed and all the appeals of the Revenue are dismissed

ITA 293/MUM/2023[2014-15]Status: DisposedITAT Mumbai28 Jun 2023AY 2014-15
Section 14ASection 33Section 35Section 80I

…be allowed in respect of such expenditure.  Expression prohibited by law has the same contextual import as the expression forbidden by law.  MCI guidelines, though applicable to doctors, would be applicable to the Pharma Company also and relied on P&H HC in 344 ITR 476.  Demanding of gifts, travel facility, hospitality, cash or monetary grant from pharma sector was bad on the part of doctors and paying it was equally bad on part on pharma companies.  In view thereof, the AO disallowed a sum of Rs.13,45,68,910/- without giving any breakup incurred for M/s. Medley Pharmaceuticals Ltd providing gifts, travel fac…

M/S. MEDLEY PHARMACEUTICALS LTD.,MUMBAI vs. DY COMM OF INCOME TAX-10(2)(2), MUMBAI

In the result, all the appeals of the assessee are partly allowed and all the appeals of the Revenue are dismissed

ITA 292/MUM/2023[2018-19]Status: DisposedITAT Mumbai28 Jun 2023AY 2018-19
Section 14ASection 33Section 35Section 80I

…be allowed in respect of such expenditure.  Expression prohibited by law has the same contextual import as the expression forbidden by law.  MCI guidelines, though applicable to doctors, would be applicable to the Pharma Company also and relied on P&H HC in 344 ITR 476.  Demanding of gifts, travel facility, hospitality, cash or monetary grant from pharma sector was bad on the part of doctors and paying it was equally bad on part on pharma companies.  In view thereof, the AO disallowed a sum of Rs.13,45,68,910/- without giving any breakup incurred for M/s. Medley Pharmaceuticals Ltd providing gifts, travel fac…

M/S. MEDLEY PHARMACEUTICALS LTD.,MUMBAI vs. DY COMM OF INCOME TAX-10(2)(2), MUMBAI

In the result, all the appeals of the assessee are partly allowed and all the appeals of the Revenue are dismissed

ITA 291/MUM/2023[2016-17]Status: DisposedITAT Mumbai28 Jun 2023AY 2016-17
Section 14ASection 33Section 35Section 80I

…be allowed in respect of such expenditure.  Expression prohibited by law has the same contextual import as the expression forbidden by law.  MCI guidelines, though applicable to doctors, would be applicable to the Pharma Company also and relied on P&H HC in 344 ITR 476.  Demanding of gifts, travel facility, hospitality, cash or monetary grant from pharma sector was bad on the part of doctors and paying it was equally bad on part on pharma companies.  In view thereof, the AO disallowed a sum of Rs.13,45,68,910/- without giving any breakup incurred for M/s. Medley Pharmaceuticals Ltd providing gifts, travel fac…

M/S. MEDLEY PHARMACEUTICALS LTD.,MUMBAI vs. DY COMM. OF INCOME TAX-10(2)(2), MUMBAI

In the result, all the appeals of the assessee are partly allowed and all the appeals of the Revenue are dismissed

ITA 290/MUM/2023[2013-14]Status: DisposedITAT Mumbai28 Jun 2023AY 2013-14
Section 14ASection 33Section 35Section 80I

…be allowed in respect of such expenditure.  Expression prohibited by law has the same contextual import as the expression forbidden by law.  MCI guidelines, though applicable to doctors, would be applicable to the Pharma Company also and relied on P&H HC in 344 ITR 476.  Demanding of gifts, travel facility, hospitality, cash or monetary grant from pharma sector was bad on the part of doctors and paying it was equally bad on part on pharma companies.  In view thereof, the AO disallowed a sum of Rs.13,45,68,910/- without giving any breakup incurred for M/s. Medley Pharmaceuticals Ltd providing gifts, travel fac…

M/S. MEDLEY PHARMACEUTICALS LTD.,MUMBAI vs. DY COMM. OF INCOME TAX-10(2)(2), MUMBAI

In the result, all the appeals of the assessee are partly allowed and all the appeals of the Revenue are dismissed

ITA 289/MUM/2023[2015-16]Status: DisposedITAT Mumbai28 Jun 2023AY 2015-16
Section 14ASection 33Section 35Section 80I

…be allowed in respect of such expenditure.  Expression prohibited by law has the same contextual import as the expression forbidden by law.  MCI guidelines, though applicable to doctors, would be applicable to the Pharma Company also and relied on P&H HC in 344 ITR 476.  Demanding of gifts, travel facility, hospitality, cash or monetary grant from pharma sector was bad on the part of doctors and paying it was equally bad on part on pharma companies.  In view thereof, the AO disallowed a sum of Rs.13,45,68,910/- without giving any breakup incurred for M/s. Medley Pharmaceuticals Ltd providing gifts, travel fac…

GALDERMA INDIA P. LTD.,MUMBAI vs. ASSTT. CIT - 9(3)(2), MUMBAI

In the result, the appeals of the assessee and Revenue are In the result, the appeals of the assessee and Revenue are In the result, the appeals of the assessee and Revenue are allowed for statisti...

ITA 1987/MUM/2020[2014-15]Status: DisposedITAT Mumbai30 Mar 2023AY 2014-15

Bench: Shri Aby T Varkey () & Shri Om Prakash Kant () Assessment Year: 2013-14 & Assessment Year: 2014-15 & Assessment Year: 2015-16 Galderma India Pvt. Ltd. Acit-9(3)(2), (Formerly Known As Nestle Skin Aayakar Bhavan, M.K. Vs. Health India Pvt. Ltd.), Road, Lotus Corporate Park, D Wing, Mumbai-400020. Unit 801 & 802, Graham Firth Steel Compound, Goregaon (E), Mumbai-400063. Pan No. Aacg 8660 M Appellant Respondent Assessment Year: 2014-15 & Assessment Year: 2015-16 Acit-1(3)(1), M/S Galderma India Pvt. Ltd., Room No. 540, 5Th Floor, (Previously Known As M/S Mestle Vs. Aayakar Bhavan, M.K. Skin Health India Pvt. Ltd.), Road, Lotus Corporate Park, ‘D’ Wing, Mumbai-400020. Unit 801 & 802, Graham Firth Steel Compound, Goregaon (E), Mumbai-400063. Pan No. Aacg 8660 M Appellant Respondent

For Respondent: Mr. Kishor Dhule, CIT-
Section 37(1)

…r relied on the decision of Hon’ble Punjab & Haryana High Court in the case of CIT v. KAP Scan & Punjab & Haryana High Court in the case of CIT v. KAP Scan & Punjab & Haryana High Court in the case of CIT v. KAP Scan & Diagnostic Centre Private Limited [2012] 344 ITR 476 to Diagnostic Centre Private Limited [2012] 344 ITR 476 Diagnostic Centre Private Limited [2012] 344 ITR 476 support that paying commission to private doctors is unethical, support that paying commission to private doctors i support that paying commission to private doctors i against public policy and forbidden by law and therefore, same was agai…

ALCON LABORATORIES (INDIA) PRIVATE LIMITED,BANGALORE vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1(1)(1), BANGALORE

In the result, the appeal by the assessee is partly allowed

ITA 224/BANG/2021[2016-17]Status: DisposedITAT Bangalore19 Dec 2022AY 2016-17

Bench: Shri N.V. Vasudevan & Ms. Padmavathy S

For Appellant: Shri Percy Pardiwala, Sr. CounselFor Respondent: Shri K. Sankar Ganesh, Jt.CIT(DR)(ITAT), Bengaluru
Section 143(2)Section 143(3)Section 92C

…Regulations, 2002 governing professional ethics of Doctors issued is salutary which is in the interest of public and patient. The Punjab and Haryana High Court has vide decision In CIT vs. M/s. Kap Scan and Diagnostic Centre (P.) Ltd. (2012) 25 taxmann.com 92/344 ITR 476 has confirmed disallowance of commission as not allowable under section 37(1) being against public policy prohibited by law. Based on factual matrix of the case as emerging from the records, the travel expenses incurred by the assessee company were in the form of seminar and conventions which bears the cost of doctors to undertake foreign tours i…

M/S ALCON LABORATORIES INDIA PRIVATE LIMITED ,BANGALORE vs. THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-1(1)(1), BANGALORE

In the result, the appeals filed by the assessee in IT(TP)A No

ITA 3376/BANG/2018[2014-15]Status: DisposedITAT Bangalore16 Nov 2022AY 2014-15

Bench: Shri N.V. Vasudevan & Shri Chandra Poojariit(Tp)A No.2889/Bang/2017 It(Tp)A No.3376/Bang/2018 Assessment Years: 2013-14 & 2014-15

For Appellant: Shri Percy Pardiwala, Sr. A.RFor Respondent: Shri Sankar Ganesh K., D.R
Section 143(3)

…The Punjab and Haryana High Court has vide decision in C.(T vs. M/s. Kap Scan and Diagnostic Centre (P.) Ltd. [2012] 25 IT(TP)A No.2889/Bang/2017 & IT(TP)A No.3376/Bang/2018 M/s. Alcon Laboratories (India) Pvt. Ltd., Bangalore Page 15 of 49 taxmann.com 92/344 ITR 476 has confirmed disallowance of commission as not allowable under section 37(1) being against public policy prohibited by law. Based on factual matrix of the case as emerging from the records, the expenses incurred by the assessee company were in the form of seminar and conventions which bears the cost of doctors to undertake foreign tours in the g…

ALCON LABORATORIES (INDIA0 PVT LTD,BENGALURU vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1(1)(1), BENGALURU

In the result, the appeals filed by the assessee in IT(TP)A No

ITA 2889/BANG/2017[2013-14]Status: DisposedITAT Bangalore16 Nov 2022AY 2013-14

Bench: Shri N.V. Vasudevan & Shri Chandra Poojariit(Tp)A No.2889/Bang/2017 It(Tp)A No.3376/Bang/2018 Assessment Years: 2013-14 & 2014-15

For Appellant: Shri Percy Pardiwala, Sr. A.RFor Respondent: Shri Sankar Ganesh K., D.R
Section 143(3)

…The Punjab and Haryana High Court has vide decision in C.(T vs. M/s. Kap Scan and Diagnostic Centre (P.) Ltd. [2012] 25 IT(TP)A No.2889/Bang/2017 & IT(TP)A No.3376/Bang/2018 M/s. Alcon Laboratories (India) Pvt. Ltd., Bangalore Page 15 of 49 taxmann.com 92/344 ITR 476 has confirmed disallowance of commission as not allowable under section 37(1) being against public policy prohibited by law. Based on factual matrix of the case as emerging from the records, the expenses incurred by the assessee company were in the form of seminar and conventions which bears the cost of doctors to undertake foreign tours in the g…

FIDELITY DIAGNOSTICS P LTD,PUNE vs. DEPUTY COMMISSIONER OF INCOME-TAX CIR 1(2), PUNE

In the result, the appeal filed by the assessee stands dismissed

ITA 189/PUN/2021[2015-16]Status: DisposedITAT Pune26 Sept 2022AY 2015-16

Bench: Shri S. S. Godara & Shri Inturi Rama Raoआयकर अपील सं. / Ita No.189/Pun/2021 िनधा"रण वष" / Assessment Year: 2015-16 Fidelity Diagnostics P. Ltd., Vs. Dcit, Circle-1(2), Pune. E-302, Marvel Diva, Magarpatta Road, Hadapsar, Pune-411028. Pan : Aabcf5899A Appellant Respondent Assessee By : Shri Sumit Jain Revenue By : Shri Ramnath P. Murkunde Date Of Hearing : 08.09.2022 Date Of Pronouncement : 26.09.2022 आदेश / Order Per Inturi Rama Rao, Am: This Is An Appeal Filed By The Assessee Directed Against The Order Of Ld. Commissioner Of Income Tax (Appeals)- National Faceless Appeal Centre, Delhi [‘The Cit(A)’] Dated 18.03.2021 For The Assessment Year 2015-16. 2. The Appellant Raised The Following Grounds Of Appeal :- “1. On The Facts & Circumstances Of The Case, The Assessing Officer & Cit(A) Has Erred In Disallowing The Genuine Business Expenditure. 2. The Appellant Craves Leave To Add, Alter Or Amend Any Of The Grounds Before Or During The Hearing Of The Appeal.” 3. Briefly, The Facts Of The Case Are As Under :

For Appellant: Shri Sumit JainFor Respondent: Shri Ramnath P. Murkunde
Section 143(3)Section 37Section 37(1)

…IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI S. S. GODARA, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.189/PUN/2021 िनधा"रण वष" / Assessment Year: 2015-16 Fidelity Diagnostics P. Ltd., Vs. DCIT, Circle-1(2), Pune. E-302, Marvel Diva, Magarpatta Road, Hadapsar, Pune-411028. PAN : AABCF5899A Appellant Respondent Assessee by : Shri Sumit Jain Revenue by : Shri Ramnath P. Murkunde Date of hearing : 08.09.2022 Date of pronouncement : 26.09.2022 आदेश / ORDER PER INTURI RAMA RAO, AM: This is an appeal filed by the assessee directed against the order of ld.…

DCIT, CIRCLE-2(1)(1),, BARODA vs. M/S. SUN PHARMACEUTICALS INDUSTRIES LTD. , BARODA

In the result, the appeal of the Revenue is partly allowed

ITA 1520/AHD/2018[2013-14]Status: DisposedITAT Ahmedabad24 Aug 2022AY 2013-14

Bench: Shri Mahavir Prasad, Judicial Memebr & Shri Waseem Ahmed, Accountant Memebr

For Appellant: Advocate & Shri Parin Shah
Section 10Section 115JSection 28

…argument is not acceptable because if accepting/demanding of illegal gratification is bad, then paying of the same is also bad. This view gets support from the ratio laid down in the following cases:- i) CIT Vs. Kap Scan and Diagnostic Centre (P) Ltd. (2012) 344 ITR 476 (P&H) In this case, the assessee company was doing the business of CT Scan, Ultra Sound and X-rays and it had debited certain amount of expenditure on account of commission paid to the practicing doctors who referred the patients to the assessee for various tests. It was held that the Indian Medical Council (Professional Conduct, Etiquette and E…

DCIT, CIRCLE-2(1)(1),, BARODA vs. M/S. SUN PHARMACEUTICALS INDUSTRIES LTD. , BARODA

In the result, the appeal of the Revenue is partly allowed

ITA 1519/AHD/2018[2011-12]Status: DisposedITAT Ahmedabad24 Aug 2022AY 2011-12

Bench: Shri Mahavir Prasad, Judicial Memebr & Shri Waseem Ahmed, Accountant Memebr

For Appellant: Advocate & Shri Parin Shah
Section 10Section 115JSection 28

…argument is not acceptable because if accepting/demanding of illegal gratification is bad, then paying of the same is also bad. This view gets support from the ratio laid down in the following cases:- i) CIT Vs. Kap Scan and Diagnostic Centre (P) Ltd. (2012) 344 ITR 476 (P&H) In this case, the assessee company was doing the business of CT Scan, Ultra Sound and X-rays and it had debited certain amount of expenditure on account of commission paid to the practicing doctors who referred the patients to the assessee for various tests. It was held that the Indian Medical Council (Professional Conduct, Etiquette and E…

SUN PHARMACEUTICALS INDUSTRIES LIMITED,,VADODARA vs. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2(1)(1), BARODA

In the result, the appeal of the Revenue is partly allowed

ITA 1463/AHD/2018[2013-14]Status: DisposedITAT Ahmedabad24 Aug 2022AY 2013-14

Bench: Shri Mahavir Prasad, Judicial Memebr & Shri Waseem Ahmed, Accountant Memebr

For Appellant: Advocate & Shri Parin Shah
Section 10Section 115JSection 28

…argument is not acceptable because if accepting/demanding of illegal gratification is bad, then paying of the same is also bad. This view gets support from the ratio laid down in the following cases:- i) CIT Vs. Kap Scan and Diagnostic Centre (P) Ltd. (2012) 344 ITR 476 (P&H) In this case, the assessee company was doing the business of CT Scan, Ultra Sound and X-rays and it had debited certain amount of expenditure on account of commission paid to the practicing doctors who referred the patients to the assessee for various tests. It was held that the Indian Medical Council (Professional Conduct, Etiquette and E…

SUN PHARMACEUTICALS INDUSTRIES LIMITED,,VADODARA vs. THE ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2(1)(1), BARODA

In the result, the appeal of the Revenue is partly allowed

ITA 1462/AHD/2018[2011-12]Status: DisposedITAT Ahmedabad24 Aug 2022AY 2011-12

Bench: Shri Mahavir Prasad, Judicial Memebr & Shri Waseem Ahmed, Accountant Memebr

For Appellant: Advocate & Shri Parin Shah
Section 10Section 115JSection 28

…argument is not acceptable because if accepting/demanding of illegal gratification is bad, then paying of the same is also bad. This view gets support from the ratio laid down in the following cases:- i) CIT Vs. Kap Scan and Diagnostic Centre (P) Ltd. (2012) 344 ITR 476 (P&H) In this case, the assessee company was doing the business of CT Scan, Ultra Sound and X-rays and it had debited certain amount of expenditure on account of commission paid to the practicing doctors who referred the patients to the assessee for various tests. It was held that the Indian Medical Council (Professional Conduct, Etiquette and E…

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