Court allows deduction of purchase costs only in tax years where corresponding sales revenue is realized.

The Supreme Court allowed the taxpayer's appeal against the tax authority's refusal to recognize purchase costs as deductible expenses. The taxpayer argued that the timing of the expense, not the revenue, should determine deductibility, while the tax authority insisted costs must be offset against income in the same year. The court ruled that under the Income Tax Act, costs are deductible only in the tax year where the corresponding revenue is earned, establishing a strict link between expense and income realization.