You need to examine the precise nature of the claims by the parties to the proceedings to consider the extent to which the fees are to be disallowed, either as capital expenditure, or by ICTA88/S74 (1)(a) or ICTA88/S74 (1)(e). The outcome of the proceedings (whether the taxpayer ‘wins’ or ‘loses’) does not determine if the expense is deductible. See both BIM40100 onwards and BIM42950 onwards for compensation and damages and BIM42515 for fines.
