Presentation articles without advertising character fall outside rule 6B disallowance under income-tax rules.

Expenditure on presentation articles was not disallowed under rule 6B(1)(a) because the Tribunal found that the articles did not bear the company name or logo and were not intended to function as advertisement material. Rule 6B applies only where presentation articles have an advertising character; absent that feature, the disallowance provision is not attracted. On those facts, the reference question was answered against the Revenue and the application for reference was rejected.

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Issues: Whether expenditure on articles intended for presentation was liable to disallowance under rule 6B(1)(a) of the Income-tax Rules, 1962.

Analysis: Rule 6B governs expenditure on advertisement and limits the allowance where the expenditure relates to articles intended for presentation that operate as advertising material. On the facts found by the Tribunal, the presentation articles did not bear the company name or logo and were not meant for advertisement. Those factual findings took the case outside the scope of rule 6B.

Conclusion: The question was answered in the negative and against the Revenue. The application for reference was rejected.

Ratio Decidendi: Rule 6B applies only where articles intended for presentation constitute or serve as advertisement material; where the articles are not shown to have any advertising character, disallowance under the rule is not attracted.

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