ITAT partly allowed the appeal of the assessee and sustained a...

ITAT partly allowed the appeal of the assessee and sustained a disallowance of business promotion expenses. The Tribunal found that a substantial portion of the claimed promotion expenditure comprised gold coins (total weight 1,049 g; cost Rs. 28,57,368), with inadequate particulars (no addresses/telephone/PAN for most recipients and unclear business nexus). On this basis ITAT disallowed 50% of the cost of the gold-coin gifts and admitted the balance. Other promotion outlays (club expenses, minor items, resort charges) were largely accepted. Accordingly, out of total claimed business-promotion expenses of Rs. 36,10,758, Rs. 14,28,684 was sustained as deductible and Rs. 21,82,074 was disallowed.

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