TaxTMI 
TaxTMI 
2014 (4) TMI 270
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....nature. 2. The appellant craves leave to add, alter or amend any ground or appeal raised above at the time of hearing." 3. Apropos deletion of addition of Rs. 1,70,05,589/- made on account of advertisement expenses. 4. Brief facts of the case are as follows. The assessee is engaged in the trading of computers and electronic products. During relevant year, the assessee had claimed expenditure on account of advertisement and marketing to the tune of Rs. 2,12,56,984/-. The Assessing Officer called for the details of such expenses in response to which, the assessee furnished ledger account supported by vouchers. However, the Assessing Officer was of the opinion that advertisement expenses were for brand building in computer retail sector and....
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....ance was bad in law and it was rightly corrected by ld CIT(A) and therefore we may not disturb the same. 7. We have heard the rival submissions and perused the records and have gone through the case laws cited by either side. We find that the assessee was incorporated on 26.09.2005, for carrying on the business of retail trading by means of company operated stores for sales of computers, laptops, peripherals and digital lifestyles products. It had opened number of stores for retail sale of various products. The company was engaged in the business of multi-brand retail sale of electronics and computers. The assessee had claimed expenditure on account of advertisement and marketing amounting to Rs. 2,12,56,984/-; the assessee furnished ledge....
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.... next year 2002-03, the total expenditure incurred on publicity and advertisement was Rs. 6.35 crores and giving an identical reason, the Assessing Officer allowed one-fifth thereof in that year too. The Commissioner (Appeals) confirmed the view of the Assessing Officer. The Tribunal held that section 35D of the Income-tax Act, 1961 was wrongly invoked as it had no applicability. The Tribunal further opined that the advertisement expenditure had actually been incurred during the year and there was a nexus between the expenditure of the assessee's business and, therefore, the expenditure was allowable under section 37 of the Act. On appeal before the Hon'ble High Court, it was held that:- "9. From the facts noted above and on the basis of t....
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.... in the year in which it was incurred. Concededly, there is no advantage which has accrued to the assessee in the capital field. The expenditure was incurred to facilitate the assessee's trading operations. No fixed capital was created by this expenditure. We may also add here that in the income-tax law, there is no concept of deferred revenue expenditure. Once the assessee claims the deduction for the whole amount of such expenditure, even in the year in which it is incurred, and the expenditure fulfils the test laid down u/s 37 of the Act, it has to be allowed. Only in exceptional cases, the nature mentioned in Madras Industrial Investment Corporation Ltd. (1997) 225 ITR 802 (SC), the expenditure can be allowed to be spread over, that too....