DEHRA DUN TEA CO. LTD. & ANR. vs COMMISSIONER OF INCOME TAX, U.P., LUCKNOW

The Supreme Court held that the tax paid by tea growers under the U.P. Large Land Holdings Tax Act, 1957 is deductible under Section 10(2)(xv) of the Income-tax Act, 1922, as it constitutes an expenditure incurred in the course of business. The Court applied the ratio from Indian Aluminium Co. Ltd. v. Commissioner of Income Tax, West Bengal, affirming that the lands are business assets and the tax is an incidental business expense. The appeal was allowed, reversing the High Court's decision in favor of the Revenue.