While Kidnaping is an offence, paying ransom is not and hence Allowable as Business Expenditure.

The Assessee, engaged in manufacturing and sale of bidis, send its director to a forest area for purchasig tendu leaves. There the directors was kidnapped by dacoits and assessee pays Ransom for secure his release.  Assessee had claimed the Ransom money as business expenditure u/s 37(1), which was disputed by department. High Court had allowed the appeal in favour of asssessee.
M/s Khemchand Motilal Jain ( Madhya Pradesh High Court)