TaxTMI 
TaxTMI 
2015 (6) TMI 1260
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.... return of income filed for the year under consideration, the assessee declared loss of Rs.1.07 crores. Even though the assesee had carried out International transactions with its associated concern, the assessee did not file the report of the accountant prescribed in Form No.3CEB as required u/s. 92E of the Act. Hence the assessing officer, without referring the matter to TPO for determining Arms Length Price of International transactions, rejected the books of account of the assessee and added 10% of the total purchases to the total income of the assessee. 3. In the appellate proceedings, the Ld. CIT(A) called for a remand report from the AO, since the assessee submitted before Ld CIT(A) that the purchase value of Beer and Wine has been ....
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....d to the bad debt adjustment and hence the said decision has no relevance to the issue under consideration. 6. In the rejoinder, the Ld. AR submitted that he placed reliance on the decision of CA Computer Associates (supra) for the limited purpose that the ALP should be determined only under any of the methods prescribed under the Act and there is no question of making any disallowance on estimated basis. He further submitted that the Associate concern of the assessee has been selling Beer and Wine at uniform rate of GBP3.50 and GBP17 per case respectively all over the world and hence there is no question of under/over invoicing. Accordingly he submitted that the purchase price paid by the assessee was at arms length and hence the impugned....
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....ct launch expenses. The assessing officer took the view that the benefit of the said expenses would be available to the assessee in the succeeding years also. Accordingly, the AO restricted the addition to 20% and disallowed remaining 80% of the expenses. In the appellate proceedings, the Ld. CIT(A) allowed 1/3rd of the expenditure and accordingly sustained addition to the extent of 2/3rd of the expenditure. 8. The Ld. AR submitted that the concept of treating expenditure as Deferred revenue expenditure is not available under the Income tax Act. On merits, the Ld A.R submitted that there is no guaranty that the benefit of product launch expenses would extend for more than a year. The Ld. AR, accordingly, submitted that the product launch e....
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....arily, revenue expenditure which is incurred wholly and exclusively for the purposes of business must be allowed in its entirety in the year in which it is incurred. However, if the facts justify claiming the expenditure over the years and if there is continuing benefit to the business of the assessee over the period, then the expenditure may be spread over. There is no dispute between the parties the product launch expenses incurred by the assessee is revenue in nature. The AO has treated the same as deferred revenue expenditure only on the reasoning that the benefit of the said expenditure would be available to the assessee in the subsequent years also. However, we are of the view that there is merit in the contentions of Ld A.R that ther....
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....ee for any purpose which is an offence or which is prohibited by law shall not be deemed to have been incurred for the purpose of business or profession and no deduction or allowance shall be made in respect of such expenditure." In the instant case, the submission of the assessee is that it has not incurred any expenditure on public advertisement, but it was incurred for organizing private events/press conference etc. Further expenses were also incurred on consultancy charges to relevant professionals, designing advertisement stalls, photographer charges etc. It was further submitted that all these expenses were incurred for promoting sale of products. Accordingly, it was submitted that these expenses were not covered by the restriction ....
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....AO noticed that Excise vend fee of Rs.2,32,406/- and Octroi duty of Rs.73,813/- was paid by the assessee's distributor named M/s Wine Enterprises. The assessee submitted that it has reimbursed the above said amounts to M/s Wine Enterprises in the subsequent year, meaning thereby the above said expenses were incurred by M/s Wine enterprises on behalf of the assessee. However, the AO took the view that the assessee should have paid these expenses on its own. Further the AO has also observed that the assessee has not shown that the above said expenses were not claimed by M/s Wine Enterprises. Accordingly, he disallowed the amounts cited above, which were paid by M/s Wine Enterprises. The Ld CIT(A) also confirmed the same. 14. We heard the par....