TaxTMI 
TaxTMI 
1982 (9) TMI 98
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....d be restricted to one-fourth of its claim. Keeping in view the fact that the expenditure claimed by the assessee is not large, I would accept the prayer of the assessee and direct the ITO to disallow one-fourth claim of the assessee. Claim for sales promotion expenses. 3. The assessee claimed the following expenses: Rs. (i) Payment to Cricket Club of India 6,066.00 (ii) Payment of bills of various hotels 4,771.00 (iii) General expenses 5,519.00 (iv) Membership fees to Cricket Club of India 335.00 16,691.00 The ITO was of the view that out of the aforesaid amount, the sum of Rs. 12,173 was in the nature of entertainment expenditure. He, therefore disallowed the same to the extent of....
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.... The assessee claimed weighted deduction under s. 35B of the IT Act, 1961 in respect of this expenditure. The ITO rejected the claim. While doing so, he observed as under: "6. During the course of assessment proceedings the assessee filed a statement declaring that a sum of Rs.21,579 was spent towards Export Promotion. Deduction under s. 35B of the Act is, therefore, claimed on this amount. It would be relevant to note here that no such deduction was claimed in the original return of income. As would be clear from the subsequent discussion, this claim of the assessee under s. 35B is purely of an exploratory nature. This amount of Rs. 21,579 represents foreign travelling expenses on a tour undertaken by the Managing Director, Mr. S.D. Nad....
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....tivity towards exports, pursuant to this foreign trip. I have therefore no hesitation in declining to grant any relief under s. 35B of the Act." 6. On appeal, the CIT(A) agreed with the ITO and confirmed his order. While doing so, he observed as under: "5. Shri Nadkarni stated that the appellant was trying to enter the export market. He also produced evidence that in subsequent period further attempts were made to enter export field. He also claimed that while carrying on this trip the appellant had taken letters from Bank of India to various representatives of this bank wherein it was stated that it was for export promotion. It is noticed that the appellant had actually joined one of the group tours organised by SOTC Travels and Tour....
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.... sound and the same call for no interference. The assessee company is not engaged in any export business. That being so, the mere fact that Shri S. D. Nadkarni went abroad will not, by itself, entitle the assessee to claim weighted deduction under s. 35B in respect of the expenditure incurred by him on his foreign tour. There is no satisfactory evidence on the record to prove that Mr. Nadkarn went abroad to explore the possibility of a foreign market for any goods manufactured by the assessee company. On the other hand, the fact that Shri Nadkarni went abroad as a member of group tour organized by certain travelling agent lends support to the view of the CIT(A) that the tour was a pleasure tour. This view is further strengthened by the fact....