Advertisement expense disallowance for alleged accommodation entries deleted where supporting evidence showed actual services and prior findings alone were insufficient.

Disallowance of advertisement expenditure on the basis that the bills were accommodation entries was held unsustainable where the assessee produced confirmation and supporting material showing actual advertising services. The addition rested mainly on the statement of the alleged entry provider and an inference that rate cards, TRP ratings and other corroboration were insufficient, but that material did not by itself establish that the impugned bills were non-genuine. Following coordinate Bench decisions on identical facts, it was held that transactions found non-genuine in other concerns of the same person could not, without more, justify treating these bills as sham. The addition was deleted.

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Issues: Whether the disallowance of advertisement expenditure on the footing that the bills represented accommodation entries was sustainable.

Analysis: The addition was based mainly on the statement of the alleged entry provider and on the view that the supporting material such as rate card, TRP rating and other corroboration was insufficient. The record, however, showed that the assessee had produced additional evidence, including confirmation and supporting material showing actual advertising services. The reasoning adopted in earlier coordinate Bench decisions on identical facts was followed, and it was held that the existence of non-genuine transactions in other concerns of the same person did not, by itself, establish that the impugned bills were non-genuine.

Conclusion: The disallowance was not justified and the addition was rightly deleted.

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