SUN PHARMACEUTICAL INDUSTRIES LTD. vs INCOME TAX OFFICER & ANR.

2025-01-31 Information

* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment reserved on: 21 October 2024
Judgment pronounced on 31 January 2025

+ W.P.(C) 8444/2018
SUN PHARMACEUTICAL INDUSTRIES
LTD. …..Petitioner
Through: Mr. Ajay Vohra, Sr. Adv. with Mr. Rohit Jain, Mr. Aniket D. Agrawal and Mr. Abhishek Singhvi, Advs.
versus

INCOME TAX OFFICER & ANR. …..Respondent
Through: Mr. Vipul Agrawal and Mr. Sanjay Kumar, SSC with Mr. Gibran Naushad and Ms. Sakshi Sherwal, Advs.
CORAM:
HON’BLE MR. JUSTICE YASHWANT VARMA
HON’BLE MR. JUSTICE RAVINDER DUDEJA

J U D G M E N T

YASHWANT VARMA, J.

1. The writ petitioner impugns the order dated 27 March 2018 in terms of which the respondent has come to reject applications filed by it seeking refund of excess tax wrongly deducted and deposited under Section 195 of the Income Tax Act, 19611. The applications themselves pertained to Financial Years2 2010-11 to 2012-13. Since the respondent has also held against the petitioner for a perceived delay in the filing of those applications, the petitioners also mount a challenge to Circular No. 07/2007 dated 23 October 2007 issued by the Central Board of Direct Taxes3 and which had introduced a prescription of limitation for the institution of such refund applications. The respondent has held against the writ petitioner not only on the ground that the applications were barred by time but also on the basis of those applications not being liable to be granted on merits. In consequence to the challenge as raised, the petitioners also seek an appropriate direction for refund of the excess tax that had come to be deposited.
2. The respondent, while dealing with those applications has firstly alluded to Circular No. 07/2007, and which according to it, had constructed a period of limitation of two years within which an application for excess tax deposited could have been preferred. It has thus held that the applications would be barred by paragraph 9 of the aforesaid circular. It has also questioned the assertion of the tax having been deducted in excess on the ground that the remittance made would not fall within the ambit of the exception which is carved out by clause (b) of Section 9(1)(v) of the Act holding that the same would not fall within the scope of interest paid on monies borrowed and used for the purposes of a business carried on outside India nor fall under the expression for the purposes of making of earning any income from any source outside India.
3. In order to appreciate the challenge which stands raised, we deem it apposite to take note of the following essential facts.
4. Ranbaxy Laboratories4 was a company which was incorporated under the Companies Act, 1956 and was engaged in the business of research, manufacture and trading of drugs and pharmaceuticals. RLL issued an Offering Circular on 13 March 2006, inviting investment in Foreign Currency Convertible Bonds5 to the tune of USD 440 Million. The bonds were stated to be convertible at any time on or after 27 April 2006 and the conversion itself envisaged to result in the holders acquiring fully paid-up equity shares at a par value of INR 5/- each in RLL. As per the stipulations contained in the Offering Document, the shares were to be represented by Global Depository Shares6 representing one share at a conversion price of INR 716.32/- per share at a fixed rate of exchange rate of INR 44.15/- per USD. The aforenoted zero coupon FCCBs were floated by RLL for the purposes of equity infusion in its wholly owned subsidiary, Ranbaxy Netherlands BV7 and for expansion of its global business operations.
5. It becomes pertinent to note that RNBV acted as the holding company of Terapia, SA, a company based in Romania and whose equity share capital was majorly held by RNBV. For the purposes of funding its global business aspirations, it is also stated to have availed of loan facilities extended to it by DBS Bank Limited in 2007 as well as a further facility from the Mizuho Corporate Bank Ltd. It is also stated to have availed of a further loan facility agreement with the Bank of Tokyo-Mitsubishi UFJ Ltd. taken in 2010 in furtherance of the aforesaid objectives as well as an additional loan from the Australia and New Zealand Banking Group Limited.
6. According to RLL, acting in terms of the Offering Document as well as the stipulations contained in the various loan facility agreements, it had paid premium/ interest to various bond holders and banks during FY 2010-11 to 2012-13 without making any deductions towards tax. It also claims to have deposited the entire premium and interest after grossing up under Section 195 and to have thus borne the burden of taxes withheld. From the disclosures which are made in this respect in paragraph 10 of the impugned order, it would appear that although the remittances to bond holders and banks were not subjected to any deduction at source, RLL, out of abundant caution, deposited the TDS on the entire premium and interest paid in purported discharge of its perceived obligations under Section 195 of the Act.
7. In the revised TDS returns that RLL came to file for FYs 2010-11 to 2012-13 on 29 March 2014, it claimed a refund of tax deposited on the aforenoted payments of premium and interest on the bonds as well as the External Commercial Borrowings8 that it had obtained. This was followed by the filing of a formal application on 31 March 2014 with the Assessing Officer9 seeking refund of the excess tax so deposited.
8. On 24 March 2015, RLL merged with the petitioner in terms of a Scheme of Arrangement with an effective date of 01 April 2014. The petitioner before us, acting as the successor-in-interest of RLL, is thereafter stated to have addressed various reminders in respect of the applications for refund which were pending. Those refund applications have ultimately come to be rejected in terms of the order dated 27 March 2018 which is impugned before us.
9. Mr. Vohra, learned senior counsel appearing for the writ petitioner, firstly assailed the findings rendered by the respondent of the applications for refund being barred by limitation and submitted that the Act itself stipulates no period or terminal point within which a claim for refund of excess TDS may be instituted. In view of the aforesaid, it was his contention that Circular No. 07/2007 is clearly ultra vires and creates a condition absent any statutory backing. According to Mr. Vohra, the CBDT could not have, by way of an administrative circular, created or introduced a condition of ineligibility insofar as a claim for refund of excess TDS was concerned.
10. Mr. Vohra also took us through the various circulars which had come to be issued by the CBDT from time to time and which had preceded the issuance of Circular No. 07/2007. According to Mr. Vohra, even if one were to go by the spirit and intent of Circular No. 07/2007, it would become apparent that the respondent has manifestly erred in rejecting the applications for refund. According to learned senior counsel, as is manifest from a reading of paragraph 4 of Circular No. 07/2007, the same was occasioned by the various representations which had been received by the Government and pertained to claims for refund of excess tax that may have been deducted and deposited. Mr. Vohra submitted that the CBDT, being cognizant of the genuine hardship that was faced by such deductors, formulated a procedure for the refund of taxes which had been wrongly or incorrectly deducted. It is these facts, which, according to learned senior counsel, informed the principled stand taken by the CBDT itself that tax which may have come to be deposited in respect of income which had neither accrued or on which no tax was payable or even where tax was due at a lesser rate, those excess payments were not liable to be construed as tax at all.
11. Our attention was also drawn to the various other clauses of Circular No. 07/2007, which according to Mr. Vohra, embody the basic intent of the Board being to facilitate the refund of all amounts which did not represent tax. Since the submissions proceeded principally on the various provisions comprised in the aforenoted circular, the same is extracted in its entirety hereinbelow: –
CIRCULAR NO.7/2007 DATED 23-10-2007
Procedure for refund of tax deducted at source under section 195 to the person deducting the tax- section 239 of the Income Tax 1961- Refunds
The Board had issued Circular No. 790 dated 20th April, 2000, laying down the procedure for refund of tax deducted under section 195, in certain situations to the person deducting the tax at source from the payment to the non-resident. Representations have been received in the Board from taxpayers requesting that the said Circular may be amended to take into account situations where genuine claim for refund arises to the person deducting the tax at source from payment to the non-resident and it does not fall in the purview of the said Circular.
2. The cases which are being referred to the Board mainly relate to circumstances where, after the deposit into Government account of the tax deducted at source under section 195,
a) the contract is cancelled and no remittance is made to the non-resident;
b) the remittance is duly made to the non-resident, but the contract is cancelled. In such cases, the remitted amount has been returned to the person responsible for deducting tax at source;
c) the contract is cancelled after partial execution and no remittance is made to the non-resident for the non-executed part;
d) the contract is cancelled after partial execution and remittance related to non-executed part is made to the non-resident. In such cases, the remitted amount has been returned to the person responsible for deducting the tax at source or no remittance is made but tax was deducted and deposited when the amount was credited to the account of the non-resident;
e) there occurs exemption of the remitted amount from tax either by amendment in law or by notification under the provisions of Income-tax Act, 1961;
f) an order is passed under section 154 or 248 or 264 of the Income-tax Act, 1961 reducing the tax deduction liability of a deductor under section 195;
g) there occurs deduction of tax twice from the same income by mistake;
h) there occurs payment of tax on account of grossing up which was not required under the provisions of the Income-tax Act, 1961;
i) there occurs payment of tax at a higher rate under the domestic law while a lower rate is prescribed in there levant double taxation avoidance treaty entered into by India.
2.1 In the cases mentioned above, income does not either accrue to the non-resident or it accrues but the excess amount in respect of which refund is claimed, is borne by the deductor. The amount deducted as tax under section.195 and paid to the credit of the Government therefore belongs to the deductor. At present, a refund is given only on a claim being made by the non-resident with whom the transaction was intended or in terms of Circular No. 790 dated 20th April, 2000.
3. In the type of cases referred to in sub-paragraph (a) of paragraph 2 the non-resident not having received any payment would not apply for a refund. For cases covered by sub-paragraph (b)to (i) of paragraph 2, no claim may be made by the non-resident where he has no further dealings with the resident deductor of tax or the tax is to be borne by the resident deductor. This resident deductor is therefore put to genuine hardship as he would not be able to recover the amount deducted and deposited as tax.
4. The matter has been considered by the Board. In the type of cases referred to above, where no income has accrued to the non-resident due to cancellation of contract or where income has accrued but no tax is due on that income or tax is due at a lesser rate, the amount deposited to the credit of Government to that 6 extent under section 195, cannot be said to be tax.
4.1 It has been decided that, this amount can be refunded, with prior approval of the Chief Commissioner of Income-tax or the Director General of Income-tax concerned, to the person who deducted it from the payment to the non-resident, under section 195.
5. Refund to the person making payment under section 195 is being allowed as income does not accrue to the non-resident or if the income is accruing no tax is due or tax is due at a lesser rate. The amount paid into the Government account in such cases to that extent, is no longer “tax”. In view of this, no interest under section 244A is admissible on refunds to be granted in accordance with this circular or on the refunds already granted in accordance with Circular No. 769 or Circular No. 790.
6. In case of refund being made to the person who made the payment under section 195, the Assessing Officer may, after giving intimation to the deductor, adjust it against any existing tax liability of the deductor under the Income-tax Act, 1961, Wealth-tax Act, 1957 or any other direct tax law. The balance amount, if any, should be refunded to the person who made such payment under section 195. A separate refund voucher to the extent of such liability under each of the direct taxes should be prepared by the Income-tax Officer or the Assessing Officer in favour of the “Income-tax Department” and sent to the bank along with the challan of the appropriate type. The amount adjusted and the balance, if any, refunded would be debitable under the major head “020-Corporation Tax” or the major head “021-Taxes on incomes other than Corporation tax” depending upon whether the payment was originally credited to the major head “020-Corporation tax” or to the major head “021-Taxes on Income other than Corporation tax”.
7. A refund in terms of this circular should be granted only after obtaining an undertaking that no certificate under section 203 of the Income-tax Act has been issued to the non-resident. In cases where such a certificate has been issued, the person making the refund claim under this circular should either obtain it or should indemnify the Income-tax Department from any possible loss on account of any separate claim of refund for the same amount by the non-resident. A refund in terms of this circular should be granted only if the deductee has not filed return of income and the time for filing of return of income has expired.
8. The refund as per this circular is, inter alia, permitted in respect of transactions with non-residents, which have either not materialized or have been cancelled subsequently. It, therefore, needs to be ensured by the Assessing Officer that they disallow corresponding transaction amount, if claimed, as an expense in the case of the person, being the deductor making refund claim. Besides, in all cases, the Assessing Officer should also ensure that in the case of a deductor making the claim of refund, the corresponding disallowance of expense amount representing TDS refunded is made.
9. The limitation for making a claim of refund under this circular shall be two years from the end of the financial year in which tax is deducted at source. However, ail cases for claim of refund under items (c) to (i) of paragraph 2 which were pending before the issue of this circular and where the claim for refund was made after the issuance of Circular No. 790 may also be considered.
10. It has been represented to the CBDT that in CircularNo.769 dated 6th August,1998, there was no time limit for making a claim for refund. A time limit of two years, for making a refund claim, was stipulated vide Circular No. 790 dated 20th April, 2000.Some cases covered by Circular No. 769, which were also covered by Circular No. 790, now listed in item (a) and (b) of paragraph 2 of this Circular, and filed before the issue of Circular No. 790, became time-barred because of the specification of time limit in Circular No. 790. It is hereby clarified that such cases may also be considered for refund.
11. This Circular is issued in supersession of the Circular No.790/2000 dated 20th April, 2000.
12. The contents of this Circular may be brought to the notice of all officers in your region.
12. Mr. Vohra further submitted that although the Board chose to create a time frame of two years, and which was described to be a period of limitation, the same clearly would not sustain absent any prescription of limitation or outer time limit having been statutorily engrafted in the Act. It was in the aforesaid light that learned senior counsel submitted that paragraph 9 of the aforenoted Circular is clearly ultra vires the Act itself.
13. While addressing submissions along those lines, Mr. Vohra also took us through Sections 200, 237 as also Section 239 of the Act to buttress his contention that the statute itself never contemplated a period of limitation within which an application for refund of TDS was liable to be submitted.
14. Section 200 as it exists in the statute book today is reproduced hereinbelow: –
Duty of person deducting tax:-
200. [(1)] Any person deducting any sum in accordance with [the foregoing provisions of this Chapter] shall pay within the prescribed time, the sum so deducted to the credit of the Central Government or as the Board directs.
[(2) Any person being an employer, referred to in sub-section (1A) of section 192 shall pay, within the prescribed time, the tax to the credit of the Central Government or as the Board directs.]
[(2A) In case of an office of the Government, where the sum deducted in accordance with the foregoing provisions of this Chapter or tax referred to in sub-section (1A) of section 192 has been paid to the credit of the Central Government without the production of a challan, the Pay and Accounts Officer or the Treasury Officer or the Cheque Drawing and Disbursing Officer or any other person, by whatever name called, who is responsible for crediting such sum or tax to the credit of the Central Government, shall deliver or cause to be delivered to the prescribed income-tax authority, or to the person authorised by such authority, a statement in such form, verified in such manner, setting forth such particulars and within such time as may be prescribed.]
[(3) Any person deducting any sum on or after the 1st day of April, 2005 in accordance with the foregoing provisions of this Chapter or, as the case may be, any person being an employer referred to in sub-section (1A) of section 192 shall, after paying the tax deducted to the credit of the Central Government within the prescribed time, prepare such statements for such period as may be prescribed and deliver or cause to be delivered to the prescribed income-tax authority or the person authorised by such authority such statement in such form and verified in such manner and setting forth such particulars and within such time as may be prescribed:]
[Provided that the person may also deliver to the prescribed authority a correction statement for rectification of any mistake or to add, delete or update the information furnished in the statement delivered under this sub-section in such form and verified in such manner as may be specified by the authority.]
[Following second proviso shall be inserted after the existing proviso to sub-section (3) of section 200 by the Finance (No. 2) Act, 2024, w.e.f. 1-4-2025:
Provided further that no correction statement shall be delivered after the expiry of six years from the end of the financial year in which the statement referred to in sub-section (3) is required to be delivered]

15. It becomes pertinent to note that the First Proviso to Section 200 enables a person to deliver to the prescribed authority the correction statement for purposes of rectification of any mistake or even to add, delete or update information that may be contained in a statement submitted by a deductor. Of equal significance is the Second Proviso which came to be inserted in Section 200(3) by Finance (No.2) Act of 2024, with effect from 01 April 2025, and which now stipulates that no correction statement would be entertained if tendered after the expiry of six years from the end of the FY in which the principal statement may have been delivered. This we do note since in the facts of the present case, the correction statement was filed with due promptitude on 29 March 2014.
16. Section 237, which deals with the subject of refunds, reads thus:-
Refunds.
237. If any person satisfies the [Assessing] Officer that the amount of tax paid by him or on his behalf or treated as paid by him or on his behalf for any assessment year exceeds the amount with which he is properly chargeable under this Act for that year, he shall be entitled to a refund of the excess.
As is evident from a perusal of that provision, any person who asserts that the amount of tax paid exceeds the liability which could have been validly foisted upon it under the Act, could petition for refund and claim the return of monies deposited in excess subject to it satisfying the AO of its claim.
17. Section 239 then provides for the manner in which a claim for refund may be lodged and stipulates that the same would have to be in accordance with the provisions contained in Section 139 with the latter regulating the procedure for submission of returns generally. Section 239 reads as follows: –
Form of claim for refund and limitation.
239. (1) Every claim for refund under this Chapter shall be made [by furnishing return in accordance with the provisions of section 139]
(2) [***]

18. Of equal significance is sub-section (2) as it existed in Section 239 and which came to be omitted by Finance (No. 2) Act, 2019 with effect from 01 September 2019. Sub-section (2) prior thereto had incorporated the following provisions: –
(2) No such claim shall be allowed, unless it is made within the period specified hereunder, namely:
(a) where the claim is in respect of income which is assessable for any assessment year commencing on or before the 1st day of April, 1967, four years from the last day of such assessment year;
(b) where the claim is in respect of income which is assessable for the assessment year commencing on the first day of April, 1968, three years from the last day of the assessment year;
(c) where the claim is in respect of income which is assessable for any other assessment year, [one year] from the last day of such assessment year;]
(d) where the claim is in respect of fringe benefits which are assessable for any assessment year commencing on or after the first day of April, 2006, one year from the last day of such assessment year.

It is in the aforesaid backdrop that Mr. Vohra submitted that the period of limitation which came to be introduced by the CBDT is clearly illegal and beyond jurisdiction.
19. Our attention was also drawn to the provisions comprised in Circular Nos. 769/1998 and 790/2000 and on the basis of which Mr. Vohra sought to underscore the fact that even those had never introduced any provision of limitation. Circular No. 769/1998 which was issued on 06 August 1998 was concerned with applications for refund in respect of excess or erroneous deduction of tax. The said Circular is reproduced hereinbelow: –
1167. Procedure for refund of tax deducted at source under section 195
1. The Board has received a number of representations for granting approval for refund of excess deduction or erroneous deduction of tax at source under section 195 of the Income-tax Act. The cases referred to the Board mainly relate to circumstances where:
(i) after the deposit of tax deducted at source under section 195,
(a) the contract is cancelled and no remittance is required to be made to the foreign collaborator;
(b) the remittance is duly made to the foreign collaborator, but the contract is cancelled and the foreign collaborator returns the remitted amount to the person responsible for deducting tax at source;
(c) the tax deducted at source is found to be in excess of tax deductible for any other reason;
(ii) the tax is deducted at source under section 195 and paid in one assessment year and remittance to the foreign collaborator is made and/ or returned to the Indian company following cancellation of the contract in another assessment year.
In all the cases mentioned above, where either the income does not accrue to the non-resident or excess tax has been deducted thereby resulting in a refund being due to the Indian enterprise which deposited the tax, at present a refund can be issued only if valid claim is made by filing a return.
2. In the absence of any statutory provision empowering the Assessing Officers to refund the tax deducted at source to the person who has deducted tax at source, the Assessing Officers insist on filing of the return by the person in whose case deduction was made at source. Even adjustments of the excess tax or the tax erroneously deducted under section 195 is not allowed. This has led to a lot of hardship as the non-resident in whose case, the deduction has been made is either not present in the country or has no further dealings with the Indian enterprise, thus, making it difficult for a return to be filed by the non-resident.
3. The matter has been considered by the Board. It has been decided that in the type of cases referred to above, a refund may be made independent of the provisions of the Income-tax Act,1961 to the person responsible for deducting the tax at source from payments to the non-resident, after taking the prior approval of the Chief Commissioner concerned.
4. The excess tax deducted would be the difference between the actual payment made by the deduct or and the lax deducted at source or that deductible. This amount should be adjusted against the existing tax liability under any of the Direct Tax Acts. After meeting such liability, the balance amount, if any, should be refunded to the person responsible for deduction of tax at source.
5. Where the tax is deducted at source and paid by the branch office of the person responsible for deduction of tax at source and the quarterly statement/annual return of tax deduction at source is filed by the branch, each branch office would be treated as a separate unit independent of the head office. After meeting any existing tax liability of such a branch, which would normally be in relation to the deduction of tax at source, the balance amount may be refunded to the said branch office.
6. The adjustment of refund against the existing tax liability should be made in accordance with the present procedure on the subject. A separate refund voucher to the extent of such liability under each of the direct taxes should be prepared by the Income-tax Officer in favour of the Income-tax Department and sent to the bank along with the challan of the appropriate type. The amount adjusted and the balance, if any, refunded would be debitable under the sub-head Other refunds below the minor head Income-tax on companies major head 020 – Corporation Tax or below the minor head Income-tax other than Union Emoluments major head 021-Taxes on Incomes other than Corporation Tax, depending upon whether the payment was originally credited to the major head 020 – Corporation Tax or to the major head 021- Taxes on Income other than Corporation Tax.
7. Since the adjustment/refund of the amount paid in excess would arise in relation to the deduction of tax at source, the recording of the particulars of adjustment/refund should be done in the quarterly statement of TDS/annual return under the signature of the ITO at the end of the statement, i.e., below the signature of the person furnishing the statement.
Circular: No. 769, dated 6-8-1998.

20. Similar provisions were made by the CBDT in Circular No. 790/2000 which came to be issued on 20 April 2000, and in paragraph 10 whereof a prescription with respect to limitation appears for the first time. That Circular is quoted hereunder: –
SECTION 195 OF THE INCOME-TAX ACT, 1961- DEDUCTION AT SOURCE – OTHER SUMS -PROCEDURE FOR REFUND OF TAX DEDUCTED AT SOURCE UNDER SECTION 195 TO PERSON DEDUCTING TAX
CIRCULAR NO.790, DATED 20-4-2000
[SUPERSEDED BY CIRCULAR N0.7/2007, DATED 23-10-2007]
1. The Board has issued Circular No. 769, dated 6-8-1998, laying down procedure for refund of tax deducted under section 195, in certain situations to the person deducting the tax at source from the payment to the non-resident. After reconsideration, Circular No. 769 is revoked with immediate effect and refund to the person deducting tax at source under section 195 shall be allowed in accordance with the provisions of this Circular.
2. The Board had received representations for approving grant of refund to the persons deducting tax at source under section 195 of the Income-tax Act, 1961. The cases referred to the Board mainly related to circumstances whereafter the deposit into Government account of tax deducted at source under section 195,
(a) the contract is cancelled and no remittance is made to the non-resident;
(b) the remittance is duly made to the non-resident, but the contract is cancelled. In such cases, the remitted amount may have been returned to the person responsible for deducting tax at source.
In the cases mentioned above, income does not accrue to the non-resident. The amount deducted as tax under section 195 and paid to credit of Government, therefore, belongs to the deductor. At present, a refund is given only, on a claim being made by the non-resident with whom the transaction was intended.
3. In the type of cases referred to in sub-paragraph (a) of paragraph 2, the non-resident not having received any payment would not apply for a refund. For cases covered by sub-paragraph (b) of paragraph 2. no claim may be made by the non-resident where he has no further dealings with the resident deductor of tax.This resident deductor is, therefore, put to genuine hardship as he would not be able to recover the amount deducted and deposited as tax.
4. The matter has been considered by the Board. In the type of cases referred to above, where no income has accrued to the non-resident due to cancellation of contract, the amount deposited to the credit of Government under section 195 cannot be said to be ‘tax’. It has been decided that this amount can be refunded, with prior approval of Chief Commissioner concerned to the person who deducted it from the payment to the non-resident under section 195.
5. The refund being made to the person who made the payment under section 195, the Assessing Officer may after giving intimation to the deductor, adjust it against any existing tax liability of the deductor under the Income-tax Act, 1961, Wealth-tax Act, 1957 or any other direct tax law. The balance amount, if any, should be refunded to the person who made such payment under section 195. A separate refund voucher to the extent of such liability under each of the direct taxes should be prepared by the Income- tax Officer or the Assessing Officer in favour of the “Income-tax Department” and sent to the bank along with the challan of the appropriate type. The amount adjusted and the balance, if any. refunded would be debitable under the sub-head “Other refunds” below the minor head “Income-tax on Companies” major head “020Corporation Tax” or below the minor head “Income-tax other than Union Emoluments” major head “021Taxes on Incomes other than Corporation Tax” depending upon whether the payment was originally credited to the major head “020Corporation Tax” or to the major head “021 Taxes on Income other than Corporation Tax”. Since the adjustment/refund of the amount paid would arise in relation to the deduction of tax at source, the recording of the particulars of adjustment/refund, should be done in the quarterly statement of TDS/annual return under the signature of the Income-tax Officer or the Assessing Officer at the end of the statement, i.e.. below the signature of the person furnishing the statement.
6. Refund to the person making payment under section 195 is being allowed as income does not accrue to the non-resident. The amount paid into the Government account in such cases, is no longer ‘tax’. In view of this, no interest under section 244A is admissible on refunds to be granted in accordance with this Circular or on the refunds already granted in accordance with Circular No.769.
7. A refund in terms of this Circular should be granted only after obtaining an undertaking that no certificate under section 203 of the Income-tax Act has been issued to the non-resident. In cases where such a certificate has been issued, the person making the refund claim under this Circular should either obtain it or should indemnify the Income-tax Department from any possible loss on account of any separate claim of refund for the same amount by the non-resident.
8. The refund as per this Circular is permitted only in respect of transactions with non-residents, which have either notmaterialised or have been cancelled subsequently. It, therefore, needs to be ensured by the Assessing Officer that they disallow corresponding transaction amount, if claimed as an expense in the case of person making refund claim.
9. It is hereby clarified that refund shall not be issued to the deductor of tax in the cases referred to in clause(i)(c) of paragraph 1 of Circular No. 769, dated 6-8-1998.
10. The limitation for making a claim of refund under this Circular shall be two years from the end of the financial year in which tax is deducted at source.

21. Proceeding further, Mr. Vohra also questioned the correctness of the view expressed by the respondent based on the exception carved out by Section 9(1)(v) and submitted that the view as expressed by the respondents was wholly unsustainable for reasons recorded hereinafter. Mr. Vohra submitted that the funds which were generated by the issuance of bonds as well as the ECBs which were taken by RLL were exclusively intended to aid the global business operations of that entity.
22. It was his submission that no part of the investments made leading up to the placement of funds in the hands of RLL or for that matter the ECBs were either routed to India or utilized in connection with the operations of RLL in this country. It was thus submitted that the interest was clearly one which had been paid by RLL for the purposes of a business undertaken outside India as well as for the purposes of making or earning income from a source outside India. Since those funds and investments, according to Mr. Vohra, were primarily utilized to shore up the financials of Terapia, SA, the payment of interest clearly fell within the scope of the exception which clause (b) carves out from the principal part of Section 9(1)(v).
23. Mr. Vohra also assailed the view taken by the respondent that those investments and utilization of funds was not liable to be acknowledged to be for the purposes of business carried on by RLL since the same was made as in connection with the affairs of Terapia, SA. According to learned senior counsel, since Terapia, SA was a wholly owned subsidiary, the respondent was clearly unjustified in disallowing that expense taking an extremely pedantic view that the same was not concerned with or relatable to the business of the petitioner. Learned senior counsel submitted that the investment and infusion of funds in Terapia SA was unquestionably connected with the business which RLL undertook overseas in the expectation of deriving income in the shape of dividend or profits from those ventures.
24. Mr. Vohra also sought to distinguish the opinion formed by the respondent based on the decision in Commissioner of Income-tax v. Havells India Ltd.10 and submitted that the same was clearly distinguishable on facts. In order to appreciate the aforenoted submission, we deem it apposite to extract the following passages from that decision: –
14. Section 9(1)(vii)(b) contemplates a source located outside India. It is difficult to conceptualise the place/situs of the person who make payment for the export sales as the source located outside India from which assessee earned profits. The export contracts obviously are concluded in India and the assessee’s products are sent outside India under such contracts. The manufacturing activity is located in India. The source of income is created at the moment when the export contracts are concluded in India. Thereafter, the goods are exported in pursuance of the contract and the export proceeds are sent by the importer and are received in India. The importer of the assessee’s products is no doubt situated outside India, but he cannot be regarded as a source of income. The receipt of the sale proceeds emanate from him from outside India. He is, therefore, only the source of the monies received. The income component of the monies or the export receipts is located or situated only in India. We are making a distinction between the source of the income and the source of the receipt of the monies. In order to fall within the second exception provided in section 9(1)(vii)(b) of the Act, the source of the income, and not the receipt, should be situated outside India. That condition is not satisfied in the present case. The Tribunal, with respect, does not appear to have examined the case from this aspect. Its conclusion that the technical services were not utilised for the assessee’s business activity of production in India does not bring the assessee’s case within the second exception in section 9(1)(vii)(b) of the Act. It does not bring the case under the first exception either, because in order to get the benefit of the first exception it is not sufficient for the assessee to prove that the technical services were not utilised for its business activities of production in India, but it is further necessary for the assessee to show that the technical services were utilised in a business carried on outside India. Therefore, we cannot also approve of the Tribunal’s conclusion in paragraph 29 of its order to the extent it seems to suggest that the assessee satisfies the condition necessary for bringing its case under the first exception. Be that as it may, as we have already pointed out, since the source of income from the export sales cannot be said to be located or situated outside India, the case of the assessee cannot be brought under the second exception provided in the section.
15. Mr. Vohra, learned counsel for the assessee, however, contended that income arose not only from the manufacturing activity but also arose because of the sales of the products and if necessary a bifurcation of the income should be made on this basis and that portion of the income which is attributable to the export sales should qualify for the second exception. This argument is only a limb of the main contention that the income arises from the export sales and the source of the income is located outside India. We have already expressed our difficulty in accepting that argument. It is true that the profits arise both from the manufacturing activity and from the sale. There are several authorities dealing with this question in the context of cases where an assessee had its manufacturing facility in British India but sold the goods outside British India. In such cases, it has been held that the profits arose both from manufacture and the sales and that part of the profit which arises from sales outside British India would be exempt from tax: See Anglo-French Textiles Co. Ltd. v. CIT (No. 2) [1953] 23 ITR 101 (SC) and CIT v. Ahmedbhai Umarbhai and Co. [1950] 18 ITR 472 (SC). But these cases are not of any assistance to the assessee in the present case since the contention here is that the source of income is the export sales and the export sales are located outside India.
16. For these reasons we are unable to hold that the assessees case falls under the second exception provided in section 9(1)(vii)(b) of the Act. In other words, we are unable to accept that the fees for technical services were paid by the assessee to the US company for the purpose of making or earning any income from any source outside India.
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27. It is well settled that expenditure incurred in connection with the issue of debentures or obtaining loan is revenue expenditure. Reference in this connection may be made to the leading judgment of the Supreme Court in India Cements Ltd. v. CIT (1966) 60 ITR 52 (SC). The question before us, however, is whether it is a debenture issue or an issue of share capital involving the strengthening of the capital base of the company. Though it prima facie appears that there are sufficient facts to indicate that what was contemplated was an issue of shares to the Mauritius company under the investor agreement which would result in strengthening of the assessee’s capital base, having regard to the judgments cited on behalf of the assessee, in which it has been held that despite indications to the effect that the debentures are to be converted in the near future into equity shares, the expenditure incurred should be allowed as revenue expenditure on the basis of the factual position obtaining at the time of the debenture issue, we are not inclined to take a different view. The following cases have been cited on behalf of the assessee in support of the view that even in such a situation the expenditure is allowable as revenue expenditure:
(i) CIT v. East India Hotels Ltd. (2001) 252 ITR 860 (Cal) ;
(ii) CIT v. ITC Hotels Ltd. (2011) 334 ITR 109 (Karn) ;
(iii) CIT v. South India Corporation (Agencies) Ltd. [2007] 290 ITR 217 (Mad) ; and
(iv) CIT v. First Leasing Co. of India Ltd. (2008) 304 ITR 67 (Mad).
28. In addition to the above judgments, we also have the judgment of the Rajasthan High Court CIT v. Secure Meters Ltd. (2010) 321 ITR 611 (Raj) against which the special leave petition filed by the Revenue was dismissed. Having regard to the predominant view taken in the above judgments, in which the judgment of the Supreme Court in India Cements Ltd. (1966) 60 ITR 52 (SC) has been noticed, we are inclined to uphold the view taken by the Tribunal that the expenditure is revenue in nature. Accordingly, we answer the substantial question of law in favour of the assessee and against the Revenue.

25. Mr. Vohra lastly placed reliance on the decision rendered by the Gujarat High Court in Multibase India Limited v. Income Tax Officer & 111 and where the powers of the CBDT in the context of Circular 7/2007 came to be lucidly explained. Mr. Vohra principally relied upon the following passages from that decision:
8. Quite apart from the fact whether the authority itself under the scheme had power to condone the delay, section 119 of the Act clearly empowers the CBDT to do so. Sub-section (1) of section 119 gives a power to the CBDT to issue such orders and instructions and directions to the income tax authorities as it may deem fit for proper administration of the Act and the authorities would observe and follow such orders and instructions of the Board. Sub-section (2) of section 119 further provides inter-alia that without prejudice to the generality of the provisions contained in sub-section (1), the Board may, if it considers it necessary or expedient so to do for avoiding genuine hardships by general or special orders authorizing the income tax authority or the Commissioner (Appeals) to admit an application or claim for any exemption, deduction, refund or any other relief under the Act after the expiry of period prescribed under the Act by or under the Act for making such application or claim and deal with the same on merits in accordance with law.
9. Thus, CBDT undoubtedly has powers to condone the delay even if we assume the Commissioner does not have such powers. We would have ordinarily requested the CBDT to examine the issue and consider exercising such powers on the petition already filed by the petitioner. However, in the present case, the dispute is lingering since quite some time. In any case, the delay is not gross and the repercussion in law is not widespread. We may recall the last date for filing refund claim under the scheme was 31.03.2008. The petitioner upon coming to realize that excess deduction has been made and deposited with the Government, approached the appropriate authority under letter dated 15.12.2008.
10. Under the circumstances, we propose to condone the delay here itself and then require the competent authority before whom the petitioner’s application for refund is pending to decide the same on merits. We order accordingly. The competent authority shall consider the petitioner’s application for refund

26. Our attention was then drawn to the significant observations which appear in the decision of the Supreme Court in Commissioner of Income Tax, Bhopal v. Shelly Products and Another12:-
33. Having considered the authorities on the subject, we find ourselves in agreement with the view of the Gujarat High Court in Saurashtra Cement and Chemical Industries Ltd. The question that falls for our consideration in these appeals is whether on the failure or inability of the authorities to frame a regular assessment after the earlier assessment is set aside or nullified, the tax deposited by an assessee by way of advance tax or self-assessment tax, or tax deducted at source is liable to be refunded to the assessee, since its retention by the Revenue would result in breach of Article 265 of the Constitution which prohibits the levy or collection of any tax except by authority of law. The Revenue does not dispute the position that if an assessment is framed, which is later nullified in appeal or revision or other proceedings, any amount paid by way of income tax pursuant to the order of assessment, over and above the advance tax and self-assessment tax is undoubtedly refundable under Section 240 of the Act. The only dispute is with regard to the refund of the advance tax and self-assessment tax which is paid by the assessee on his own assessment of his liability and is based on the return of income filed by him. According to the Revenue, the tax so paid represents the admitted liability of the assessee, and failure or inability to frame another assessment after the earlier assessment is set aside or nullified in appropriate proceedings, does not entitle the assessee to claim refund because to this extent the assessee has admitted his liability to pay tax in accordance with law. The tax liability is computed on the basis of the relevant Finance Act laying down the rate or rates at which the tax is payable and provides for other matters relevant to the computation of tax. Thus the tax is required to be paid in advance by the assessee, even before assessment is made, and he himself is required to compute his liability having regard to the rates and exemptions applicable. Thus, both the levy and collection of tax is in accordance with law.
34. We find considerable force in the submission of the Revenue and it must be upheld. We have earlier noticed the scheme of the Act. Section 4 of the Act creates the charge and provides inter alia for payment of tax in advance or deduction of tax at source. The Act provides for the manner in which advance tax is to be paid and penalises any assessee who makes a default or delays payment thereof. Similarly the deduction of tax at source is also provided for in the Act and failure to comply with the provisions attracts the penal provisions against the person responsible for making the payment. It is, therefore, quite apparent that the Act itself provides for payment of tax in this manner by the assessee. The Act also enjoins upon the assessee the duty to file a return of income disclosing his true income. On the basis of the income so disclosed, the assessee is required to make a self-assessment and to compute the tax payable on such income and to pay the same in the manner provided by the Act. Thus the filing of return and the payment of tax thereon computed at the prescribed rates amounts to an admission of tax liability which the assessee admits to have incurred in accordance with the provisions of the Finance Act and the Income Tax Act. Both the quantum of tax payable and its mode of recovery are authorized by law. The liability to pay income tax chargeable under Section 4(1) of the Act thus, does not depend on the assessment being made. As soon as the Finance Act prescribes the rate or rates for any assessment year, the liability to pay the tax arises. The assessee is himself required to compute his total income and pay the income tax thereon which involves a process of self-assessment. Since all this is done under authority of law, there is no scope for contending that Article 265 is violated.
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36. We cannot lose sight of the fact that the failure or inability of the Revenue to frame a fresh assessment should not place the assessee in a more disadvantageous position than in what he would have been if a fresh assessment was made. In a case where an assessee chooses to deposit by way of abundant caution advance tax or self- assessment tax which is in excess of his liability on the basis of return furnished or there is any arithmetical error or inaccuracy, it is open to him to claim refund of the excess tax paid in the course of assessment proceeding. He can certainly make such a claim also before the authority concerned calculating the refund. Similarly, if he has by mistake or inadvertence or on account of ignorance, included in his income any amount which is exempted from payment of income tax, or is not income within the contemplation of law, he may likewise bring this to the notice of the Assessing Authority, which if satisfied, may grant him relief and refund the tax paid in excess, if any. Such matters can be brought to the notice of the authority concerned in a case when refund is due and payable, and the authority concerned, on being satisfied, shall grant appropriate relief. In cases governed by Section 240 of the Act, an obligation is cast upon the Revenue to refund the amount to the assessee without his having to make any claim in that behalf. In appropriate cases therefore, it is open to the assessee to bring facts to the notice of the authority concerned on the basis of the return furnished, which may have a bearing on the quantum of the refund, such as those the assessee could have urged under Section 237 of the Act. The authority concerned, for the limited purpose of calculating the amount to be refunded under Section 240 of the Act, may take all such facts into consideration and calculate the amount to be refunded. So viewed, an assessee will not be placed in a more disadvantageous position than what he would have been, had an assessment been made in accordance with law.
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40. The respondents contend that the circular of the Board is binding upon the authorities of the Income Tax Department and, therefore, so far as the Income Tax Authorities are concerned, they must give to the amendment brought about in Section 240 only prospective operation.
41. We find that para 13.2 of the circular does not advance the case of the respondents. The circular only states that some of the judicial pronouncements did not permit a retention of even the tax due on the basis of the returned income and directed the refund of tax deducted at source or advance tax. To overcome this difficulty and to make the position clear, the proviso to Section 240 was inserted. A plain reading of the circular also indicates that the Board also took the view that the amendment was clarificatory and that it had become necessary to get over the difficulties posed by the judicial pronouncements directing refund of the entire tax including the advance tax and tax deducted at source, which were payable on the basis of income declared in the return by the assessee himself. It is, therefore, not necessary for us to consider the larger question as to the extent to which such circulars are binding upon the Department. In any event, as submitted by counsel for the appellant, the relevant part of the circular contains only a statement of fact. There is no instruction, direction or order to the authorities to act in a particular manner. As rightly submitted by him, the statutory provision has to be examined for its true effect and the circular, in the instant case, is not relevant.

27. Mr. Vohra then drew our attention to a judgment rendered by this Court in Vijay Gupta v. Commissioner of Income-tax and Another13 and where we had laid emphasis on an assessee not being liable to be denied a refund in respect of taxes erroneously deposited or mistakenly paid. It would be appropriate to reproduce the following passages from Vijay Gupta hereunder:
35. From the various judicial pronouncements, it is settled that the powers conferred under section 264 of the Act are very wide. The Commissioner is bound to apply his mind to the question whether the petitioner was taxable on that income. Since section 264 uses the expression “any order”, it would imply that the section does not limit the power to correct errors committed by the subordinate authorities but could even be exercised where errors are committed by assessees. It would even cover situations where the assessee because of an error has not put forth a legitimate claim at the time of filing the return and the error is subsequently discovered and is raised for the first time in an application under section 264.
36. An assessee is liable to tax only upon such receipt as can be included in his total income and is assessable under the Income-tax Act. There is nothing in section 264, which places any restriction on the Commissioner’s revisional power to give relief to the assessee in a case where the assessee detracts mistakes because of which he was over-assessed after the assessment was completed. Once it is found that there was a mistake in making an assessment, the Commissioner had power to correct it under section 264(1). When the substantive law confers a benefit on the assessee under a statute, it cannot be taken away by the adjudicatory authority on mere technicalities. It is settled proposition of law that no tax can be levied or recovered without authority of law. Article 265 of the Constitution of India and section 114 of the State Constitution imposes an embargo on imposition and collection of tax if the same is without authority of law.
37. The Commissioner further erred in rejecting the application under section 264 holding that intimation under section 143(1) could not be regarded as an order and was thus not amenable to revisionary
jurisdiction under section 264 of the Act. The Intimation under section 143(1) is regarded as an order for the purposes of section 264 of the Act*. He failed to appreciate that the petitioner was not only impugning the intimation under section 143(1) but also the rejection of the application under section 154 of the Act.
38. In the present case, as per the petitioner, in his return of income, he has erroneously offered to tax gains arising on sale of shares as short-term capital gains instead of same being long-term capital gains exempt from tax. Subsequently, the petitioner on January 14, 2011 filed the application under section 154 of the Act. The Assessing Officer on February 21, 2011 partly rectified the intimation and computed the tax on capital gains at 10 per cent. as against 30 per cent. computed in the intimation issued under section 143(1) of the Act. The Assessing Officer, however refused to accept the application under section 154 filed by the petitioner. When the Assessing Officer could rectify the intimation on February 21, 2011, he could also consider the prayer of the petitioner made in the rectification application under section 154 of the Act, which was already pending before him on that date.
39. When the Commissioner was called upon to examine the revision application under section 264 of the Act, all the relevant material was already available on the record of the Assessing Officer. The Commissioner instead of merely examining whether the intimation was correct based on the material then available should have examined the material in the light of the Circular No. 14(XL-35) of 1955, dated April 11, 1955 and article 265 of the Constitution of India. The Commissioner has erred in not doing so and in failing to exercise the jurisdiction vested in him on mere technical grounds.

28. Proceeding then to explain the meaning liable to be ascribed to the expression for the purposes of business as it appears in Section 9(1)(v), Mr. Vohra submitted that the respondent has grossly erred in seeking to perceive a distinction which the law would countenance in respect of investments made by an entity in itself and those pertaining to related or sister concerns. Mr. Vohra submitted that the Supreme Court has consistently held that the expression for the purposes of business as occurring in the Act is liable to be answered on the anvil of commercial expediency and thus recognizing the indelible interest that a holding entity may have in a subsidiary. Our attention was drawn to the lucid enunciation of the legal position in this respect which appears in S.A. Builders Ltd. v. Commissioner of Income Tax (Appeals) Chandigarh and Another14:-
20. We have considered the submission of the respective parties. The question involved in this case is only about the allowability of the interest on borrowed funds and hence we are dealing only with that question. In our opinion, the approach of the High Court as well as the authorities below on the aforesaid question was not correct.
21. In this connection we may refer to Section 36(l)(iii) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) which states that “the amount of the interest paid in respect of capital borrowed for the purposes of the business or profession” has to be allowed as a deduction in computing the income tax under Section 28 of the Act.
22. In Madhav Prasad Jatia v. CIT this Court held that the expression “for the purpose of business” occurring under the provision is wider in scope than the expression “for the purpose of earning income, profits or gains”, and this has been the consistent view of this Court.
23. In our opinion, the High Court in the impugned judgment, as well as the Tribunal and the Income Tax Authorities have approached the matter from an erroneous angle. In the present case, the assessee borrowed the fund from the bank and lent some of it to its sister concern (a subsidiary) on interest-free loan. The test, in our opinion, in such a case is really whether this was done as a measure of commercial expediency.
24. In our opinion, the decisions relating to Section 37 of the Act will also be applicable to Section 36(l)(iii) because in Section 37 also the expression used is “for the purpose of business”. It has been consistently held in decisions relating to Section 37 that the expression “for the purpose of business” includes expenditure voluntarily incurred for commercial expediency, and it is immaterial if a third party also benefits thereby.
25. Thus in Atherton v. British Insulated & Helsby Cables Ltd. it was held by the House of Lords that in order to claim a deduction, it is enough to show that the money is expended, not of necessity and with a view to direct and immediate benefit, but voluntarily and on grounds of commercial expediency and in order to indirectly facilitate the carrying on of the business. The above test in Atherton case has been approved by this Court in several decisions e.g. Eastern Investments Ltd. v. CIT, CIT v. Chandulal Keshavlal & Co., etc.
26. In our opinion, the High Court as well as the Tribunal and other Income Tax Authorities should have approached the question of allowability of interest on the borrowed funds from the above angle. In other words, the High Court and other authorities should have enquired as to whether the interest-free loan was given to the sister company (which is a subsidiary of the assessee) as a measure of commercial expediency, and if it was, it should have been allowed.
27. The expression “commercial expediency” is an expression of wide import and includes such expenditure as a prudent businessman incurs for the purpose of business. The expenditure may not have been incurred under any legal obligation, but yet it is allowable as a business expenditure if it was incurred on grounds of commercial expediency.
28. No doubt, as held in Madhav Prasad Jatia v. CIT if the borrowed amount was donated for some sentimental or personal reasons and not on the ground of commercial expediency, the interest thereon could not have been allowed under Section 36(l)(iii) of the Act. In Madhav Prasad case the borrowed amount was donated to a college with a view to commemorate the memory of the assessee’s deceased husband after whom the college was to be named. It was held by this Court that the interest on the borrowed fund in such a case could not be allowed, as it could not be said that it was for commercial expediency.
29. Thus, the ratio of Madhav Prasad Jatia case is that the borrowed fund advanced to a third party should be for commercial expediency if it is sought to be allowed under Section 36(l)(iii) of the Act. a
30. In the present case, neither the High Court nor the Tribunal nor other authorities have examined whether the amount advanced to the sister concern was by way of commercial expediency.
31. It has been repeatedly held by this Court that the expression for the purpose of business is wider in scope than the expression for the purpose of earning profits vide CIT v. Malayalam Plantations Ltd. 5, CIT v. Birla Cotton Spg. & Wvg. Mills Ltd., etc.
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36. We agree with the view taken by the Delhi High Court in CIT v. Dalmia Cement (B) Ltd. that once it is established that there was nexus between the expenditure and the purpose of the business (which need not necessarily be the business of the assessee itself), the Revenue cannot justifiably claim to put itself in the armchair of the businessman or in the position of the Board of Directors and assume the role to decide how much is reasonable expenditure having regard to the circumstances of the case. No businessman can be compelled to maximise its profit. The Income Tax Authorities must put themselves in the shoes of the assessee and see how a prudent businessman would act. The authorities must not look at the matter from their own viewpoint but that of a prudent businessman. As already stated above, we have to see the transfer of the borrowed funds to a sister concern from the point of view of commercial expediency and not from the point of view whether the amount was advanced for earning profits.
37. We wish to make it clear that it is not our opinion that in every case interest on borrowed loan has to be allowed if the assessee advances it to a sister concern. It all depends on the facts and circumstances of the respective case. For instance, if the Directors of the sister concern utilise the amount advanced to it by the assessee for their personal benefit, obviously it cannot be said that such money was advanced as a measure of commercial expediency. However, money can be said to be advanced to a sister concern for commercial expediency in many other circumstances (which need not be enumerated here). However, it is obvious that a holding company has a deep interest in its subsidiary, and hence if the holding company advances borrowed money to a subsidiary and the same is used by the subsidiary for some business purposes, the assessee would, in our opinion, ordinarily be entitled to deduction of interest on its borrowed loans.

29. As is evident from the aforesaid extracts, the Supreme Court while propounding the test of commercial expediency had unambiguously held that although the borrowed amount may not have been utilized by the assessee in its own business and may have been advanced as an interest free loan to a sister concern, the same would clearly not be determinative since what would be significant would be whether that amount as offered to the sister concern was as a measure of commercial expediency.
30. It is this view as expressed in SA Builders which has been consistently followed by the Supreme Court as well as various High Courts including our own. In Hero Cycles (Private) Limited v. Commissioner of Income Tax (Central), Ludhiana15, Mr. Vohra submitted, the Supreme Court, while reiterating the foundational principles propounded by the Supreme Court in SA Builders had held as under:-
11. Insofar as loans to the sister concern/subsidiary company are concerned, the law in this behalf is recapitulated by this Court in S.A. Builders Ltd. v. CIT3. After taking note of and discussing on the scope of commercial expediency, the Court summed up the legal position in the following manner: (SCC pp. 787-88, paras 27-31)
27. The expression “commercial expediency” is an expression of wide import and includes such expenditure as a prudent businessman incurs f