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| The Tax Publishers2020 TaxPub(DT) 2757 (Del-Trib) INCOME TAX ACT, 1961
Section 37(1)
Where assessee company gave various schemes to its advertiser like consumption incentive, series discount etc. on basis that if it consumed particular amount of time during given period for broadcasting then it was entitled to consumption incentive, expenditure was in nature of incentive to advertiser and was allowable to assessee, who also showed income against said expenditure.
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Business expenditure - Allowability - Consumption incentive given to advertisers whether an unascertained liability -
Assessee was in business of media engaged in broadcasting of advertisement in its channel. It sold space in its channels to advertiser and gave various schemes to its advertiser like consumption incentive, series discount etc. Revenue sought to disallow same on allegation that assessee itself shown amount as provision for discount not debited to accounts of respective parties. Held: Assessee company gave various schemes to its advertiser like consumption incentive, series discount etc. In case of consumption incentive, advertisers were given an offer that in case if it consumes particular amount of time during the given period for broadcasting and advertising then it will be entitled to consumption incentive. CIT(A) held that expenditure was in nature of incentive to advertiser and assessee also showed income against said expenditure. Before CIT(A), assessee demonstrated by producing copies of deals of some of parties and showed that it was not an asset or liability but actual expenditure. In view of same, CIT(A) rightly held that assessee was eligible for deduction of aforesaid expenditure.
Followed:TV Today Network Ltd. v. ACIT & (Vice-Versa) [ITA No. 6080/Del/2012, dt. 28-3-2019] : 2019 TaxPub(DT) 2066 (Del-Trib)
REFERRED :
FAVOUR : In assessee's favour
A.Y. : 2011-12
INCOME TAX ACT, 1961
Section 37(1)
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