1983 (10) TMI 91

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....this appeal states that the Commissioner (Appeals) erred in holding that the medical expenses reimbursed by the assessee-company were not in the nature of perquisites for the purpose of disallowance under section 40A(5) of the Income-tax Act, 1961 ('the Act') and that for disallowing the perquisites paid to an employee-director, the provisions of section 40(c) of the Act and not those of section 40A(5) would apply. Smt. V. Gopalakrishnan, the learned representative for the department, urged before us that the Commissioner (Appeals) erred in his decision. On the other hand, Shri S.P. Mehta, the learned representative for the assessee, supported the order of the Commissioner (Appeals). We have considered the contentions of both the parties as....

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....rectly advertise its products because of the prohibition under the excise laws, the only alternative open to the assessee to boost its sales and earn greater commission was to give free samples of the products it wants to sell to potential customers. Shri S.P. Mehta explained that the manufacturer would not bear the cost of the samples and so, the assessee had to buy them and distribute them as samples with a view to promote their sales. Under the circumstances, he urged that the expenses have been rightly allowed as sales promotion expenses by the Commissioner (Appeals) as distinct from entertainment expenses as held by the ITO. 6. We have considered the contentions of both the parties as well as the facts on record. The case of the asses....