ITAT upholds Sun Pharma Labs Ltd.’s Deduction for Consultancy fees paid to McKinsey & Company, Classifying it as Revenue Expenditure

The ITAT upheld Sun Pharma Labs Ltd.'s deduction for consultancy fees paid to McKinsey & Company, classifying it as revenue expenditure. The case involved a dispute over the nature of the consultancy fees, with the tax authorities arguing it should be capitalized. The ITAT ruled in favor of Sun Pharma, stating that the fees were incurred for business operations and should be treated as revenue expenditure. This decision provides clarity on the treatment of consultancy fees for tax purposes.